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TMI Blog1971 (9) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... he Mysore Act "), amounted to an assessment ; and (2) whether the interpretation placed by the Income-tax Tribunal on the words " such income, profits and gains " in paragraph 5(1) of the Part B States (Taxation Concessions) Order, 1950 (hereinafter called " the Order "), is correct ? On the first question its answer was in the affirmative and on the second in the negative. Against this judgment two appeals have been filed by special leave by the Commissioner of Income-tax, Mysore. The facts which gave rise to the reference before the High Court are that a registered firm of partnership known as C. M. Jaffar Khan & Co., Bangalore, of which the assessee was a partner, filed a return in respect of its income for the period ending June 30, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e firm could not be regarded as an assessment made on the assessee individually and completed the assessment for the years 1950-51 on March 6, 1955, on a total income of Rs. 3,21,821. The assessee appealed to the Income-tax Appellate Assistant Commissioner and raised similar contentions to those raised before the Income-tax Officer. The Income-tax Officer on the other hand contended that as the respondent-assessee had disclosed only a share income from the firm " C. M. Jaffar Khan & Co." and as the income from the property and other sources was not disclosed, such profits and gains had not been assessed under the Mysore Act and, therefore, action under section 34 of the Act was fully justified. The Appellate Assistant Commissioner, howeve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would happen is that there would be two assessments in respect of the income of an assessee during one assessment year." The contentions of the learned advocate for the revenue follow much on the same lines as were the contentions before the High Court of Mysore, namely, that as the assessee did not disclose his personal income except that of the income of the firm, that income could not have been assessed under the Mysore Act, as such, it is open to the Income-tax Officer to make an assessment under section 34 of the Act. He further contends that the object of the Order was to give relief from double taxation because on the financial integration of the Part B States of which Mysore was one, the assessment of income, profits and gains of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me-tax Officer has reason to believe that by reason of the omission or failure on the part of an assessee to make a return of his income under section 22 for any year or to disclose fully and truly all material facts necessary for his assessment for that year, income, profits or gains chargeable to income-tax have escaped assessment for that year, or.... (b) notwithstanding that there has been no omission or failure as mentioned in clause (a) on the part of the assessee, the Income-tax Officer has in consequence of information in his possession reason to believe that income, profits or gains chargeable to income-tax have escaped assessment for any year, he may in cases falling under clause (a) at any time within eight years and in cases ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1949. When the Income-tax Officer called for the books of the earlier year the books were not produced by the assessee. In the circumstances, a sum of Rs. 1,37,000 out of the opening balance as on July 1, 1949, was treated as income from undisclosed sources for the year 1951-52. But on appeal the Appellate Assistant Commissioner held that the financial year ending March 31, 1950, ought to betaken as the previous year for the income from undisclosed sources. In the meantime the appellant submitted a fresh return for the assessment year 1950-51 on which no action was taken but on October 15, 1957, the Income-tax Officer served a notice of reassessment under section 34 of the Act calling upon the appellant to submit a fresh return. That order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied therein. There can be no doubt that for the assessment year 1950-51, for which the accounting year is the previous year 1st April, 1949, to 31st March 1950, the Act applies and assessments would be made thereunder. This would be a hardship because under any of the tax laws of Part B States an assessee in that State may have been taxed already. It is in order to remove this hardship that the Order was issued under section 60A of the Act. This apart it may also be noticed that any omission to give information, or failure to file a return or failure to disclose truly and fully all material facts which are a condition of the reopening of assessments under section 34 of the Act do not appertain to the Income-tax Officer under the Act but to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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