9911796707
TMI Blog1979 (8) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... 31st March, 1954, the assessee-trust filed a return of income on 31st March, 1954. The ITO took the view that the assessee-trust was sham and bogus and was created merely as a device for evasion of tax and he, therefore, refused to recognise the assessee-trust as valid and made an order stating that the income accruing to the assessee-trust should be assessed in the hands of S. Raghubir Singh. The income of the assessee-trust was accordingly included in the individual assessment of S. Raghubir Singh and assessment was made on him on that basis. S. Raghubir Singh carried the matter higher in appeal and ultimately the Punjab High Court on a reference made by the Tribunal held that the assessee-trust was a valid trust and that the income whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... saved by the second proviso to section 34(3) of the Income-tax Act, 1922 ? " was referred by the Tribunal to the High Court. The High Court agreed with the view taken by the Tribunal and held that the second proviso to s. 34(3) was not attracted because the assessee-trust and S. Raghubir Singh were two different persons and the assessee-trust was not intimately connected with the assessment of S. Raghubir Singh. The revenue thereupon preferred the present appeal after obtaining certificate of fitness from the High Court. It is now well settled as a result of the decision of this court in ITO v. Murlidhar Bhagwan Das [1964] 52 ITR 335, that two conditions are necessary for the applicability of the second proviso to s. 34(3). The first is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld be said to be " any person " within the meaning of the second proviso to s. 34(3). This court observed in Murlidhar Bagwan Das's case [1964] 52 ITR 335 (SC), that the expression " any person " in the context in which it occurs must be confined to a person intimately connected with the assessment in which the finding is given in the sense that such person would directly be liable to be assessed for the whole or a part of the income that went into the former assessment. The person sought to be reassessed must not be a stranger to the proceeding for assessment in which the finding was given. Here it is difficult to say how the assessee-trust could be said to be intimately connected with the assessment of S. Raghubir Singh. The assessee-trus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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