TMI Blog1964 (8) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... the bare statement of the position as above, was clearly attracted. In those years, there were also separate assessments on the minors, their mother acting as the guardian for the submission of their returns. The omission to apply section 16(3) of the Income-tax Act was noticed subsequently and the Income-tax Officer issued notices to the assessee under section 34(1)(a) for the first two assessment years and under section 34(1)(b) for 1954-55. The assessee filed returns declaring the same incomes as originally assessed and contended that the assessments could not be reopened. The Income-tax Officer however took the view that, beyond stating that certain persons were minors, there was no indication in the returns submitted by the assessee that these minors are the sons of the assessee who derived income from the same partnership in which the assessee was a partner. There was, according to the Income-tax Officer, an omission on the part of the assessee to disclose fully and truly all the material facts necessary for his assessment. In this view, reassessments were made. In so far as the last year is concerned, the reassessment was purportedly made under section 34(1)(b), it being un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he principal argument advanced by Mr. Srinivasan, learned counsel for the assessee, is that the only duty which the assessee is called upon to discharge in relation to his assessment is that which is set out in section 22 of the Act and so long as that duty is discharged, any other information which the Income-tax Officer might feel it necessary for him could only be obtained from the assessee by the concerned officer calling for that information. The assessee, so it is claimed, is required to comply with the requirements of section 22 of the Act and no further duty lies upon him. It is not however denied that in the returns, while the names of the sons of the assessee were given, their relationship to the assessee was not at all indicated. In the return for the assessment year 1952-53, they were shown as minors. In the returns for the subsequent years, even that fact was not indicated. The question then is whether the only duty which an assessee has in relation to his assessment is that contained in section 22 of the Act and whether if the return contains the particulars indicated therein, the assessee's failure to disclose a relevant fact, relevant to the application of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... various parts of the form of return and the several particulars which are indicated by the headings in the form and found that there was no part in the form providing for the inclusion of such an income as has been referred to. There was no appropriate head in the form in which this part of the income which is includible in the income of the assessee under section 16(3) of the Act could be shown. It was principally for the reason that there was no appropriate head that the learned judges reached the conclusion that no duty lay upon the assessee in this regard. Dealing next with the failure to disclose fully and truly all material facts, they thought that to accept the argument that there was failure to show this part of the income in the return would virtually amount to re-writing the provision, such as failure to disclose fully and truly in his return all material facts necessary for his assessment for that year . They accordingly reached the conclusion that, even if there was a duty, section 34(1)(a) wo uld not be attracted. The further reason which the learned judges gave was that in so far as the income derived from the partnership is concerned, the assessment of an assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his part to include the income of the minors within his total income for computation under section 16(3) of the Act. If the return contains all the material facts which would put the officer in a position to compute the total income, it is the duty of the officer to include the income contemplated by section 16. There is no further obligation laid on the assessee. It will be noticed that in the case dealt with by the Andhra Pradesh High Court, in his return, the assessee had shown that his minor sons had been admitted to the benefits of the partnership in which he was also a partner, a position almost similar to that which obtains in the Bombay decision. It seems to us that whether section 22, of its own force, casts an obligation upon the assessee to disclose an income includible in his assessment by reason of section 16(3)(a)( ii) or not section 34(1)(a) contemplates a failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for that year. The expression used herein is necessary for his assessment . Section 16 of the Act provides for the inclusion of the share income of the minor child of an assessee from the firm i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thority has to draw the proper legal inferences and ascertain on a correct interpretation of the taxing enactment the proper tax leviable ... There can be no doubt that the duty of disclosing all the primary facts relevant to the decision of the question before the assessing authority lies on the assessee. They refer to the Explanation to section 34 and point out that the assessee's omission to bring to the assessing authority's attention particular items in the account books or particular portions of the document which are relevant will amount to omission as contemplated. They further say: Nor will he be able to contend successfully that by disclosing certain evidence, he should be deemed to have disclosed other evidence which might have been discovered by the assessing authority if he had pursued investigation on the basis of what has been disclosed. They finally point out that the duty of the assessee consists in placing before the assessing authority all primary facts and it is for the assessing authority to decide what inferences of fact and inferences of law have ultimately to be drawn from these primary facts. It is not for the assessee to tell the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... possession of any information which would guide his investigation in that regard. The assessment records of neither the firm nor of the minor sons of the assessee form part of the record in the present case. We have no means of knowing whether this information relevant to the application of section 16(3) is at all available in those records. Indeed, it has been found that, in so far as the assessments of the minor sons are concerned, the mother of the minors purported to appear as the guardian. Those returns would not have disclosed to the Income-tax Officer that these minors in whose names separate assessments were being made were the sons of this assessee at all. We would refer to the observations of their Lordships of the Supreme Court in the decision cited, which deals with the Explanation to section 34, and the remarks which they make in that connection are quite apposite in this context. Merely to say that the assessment of the firm and the assessments of the minors as individuals were done by the same Income-tax Officer cannot, in our view, be relied upon to support the theory that the precise information which was required in the present case was made available to the Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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