Law:

Section:

Section 147 of the Income-tax Act, 1961 [Corresponding to section 34 of the Indian Income-tax Act, 1922] - Income escaping assessment - General - Assessment years 1943-44 and 1944-45 - Whether notice of reassessment would be valid only if facts or figures on non-disclosure of which requisite belief is based either admittedly relate to concerned assessee or are at least alleged to related to him and non-disclosed facts or figures have relevance to income of accounting period in respect of which assessment proceedings are sought to be reopened - Held, yes FACTS One 'J' formed, during his lifetime a Hindu undivided family with his wife and his four sons including petitioner. 'J,' in his individual capacity, was a partner of a firm. There were several other partners in that firm, but none of them was a brother of the petitioner. It was stated by the petitioner that a complete partition of the Hindu undivided family property was effected. By an order dated 24-8-1965, passed by the ITO under section 25A of the 1922 Act, the disruption and partition was accepted by the income-tax authorities. The assessment of the HUF and the partnership firm in respect of the assessment years 1943-44 and 1944-45 were completed. 'K', the father of 'J', had made a will on 10-12-1943, wherein he had made provision for the disposal of his property in favour of 'J' and others. The said will of 'K' referred to a gift of six lakhs rupees having been made to 'J' for investment in business. Thereafter, the ITO issued a notice under section 34 of the 1922 Act to 'J' on ground that for the assessment year 1943-44, there was a deposit in the books of firm which was alleged to represent the sale proceeds of gold belonging to 'K' and the source of this gold had not adequately been explained and in respect of the assessment year 1944-45, the source of investment made by the family of Rs. 6,00,000 and certain other deposits were not property explained. On writ, the petitioner submitted that these was no reason to believe that there was any omission or failure on the part of the Hindu undivided family to disclose fully and truly all material facts necessary for assessment of the Hindu undivided…

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