Reassessment under section 34(1)(a) upheld where cash credit entries were not disclosed and eight year limitation applied.

Whether reassessment under section 34(1)(a) was valid is examined by reference to disclosure of cash-credit entries, the applicable limitation period, and an alternative head of income. The Tribunal held that mere book entries do not constitute disclosure to the tax officer unless specifically brought to attention, and the assessee failed to disclose all material facts necessary for assessment. The applicable limitation for reassessment was eight years and the assessment was completed within that period; alternatively, the matter fell within an alternative income head permitting reassessment within eight years. The assessment was therefore found legal and valid in favour of Revenue.

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Issues: Whether the assessment made under section 34(1)(a) of the Income-tax Act was legal and valid on the facts and circumstances of the case.

Analysis: The Tribunal found that entries relating to cash credits in the assessee's books did not amount to disclosure of the information contained in those entries to the Income-tax Officer unless attention was specifically drawn to them, and that the assessee failed to disclose fully and truly all material facts necessary for the assessment for the relevant previous year. The limitation for reassessment under section 34(1)(a) as it stood for the assessment year in question was eight years and the impugned assessment was completed within that period. Alternatively, the case fell within the scope of section 28(1)(c) and section 34(2) permitted completion of assessment within eight years.

Conclusion: The assessment under section 34(1)(a) was legal and valid and the reference is answered in the affirmative; result is in favour of Revenue.

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