Primary facts disclosure rule bars reopening where escapement stems from the tax officer's erroneous view on chargeability.

An assessee satisfies the disclosure obligation by placing all primary facts material to assessment before the tax authority; it is not required to state the correct legal inference or the proper basis of chargeability. Once those primary facts are disclosed, the authority must draw the necessary legal conclusions. On the stated facts, disclosure of the relevant bank account and sale proceeds in British India was sufficient, and the alleged omission of another account did not amount to suppression of a primary material fact. Any escapement arose from the Income-tax Officer's erroneous view on chargeability, not from failure to disclose. The condition precedent for reopening under section 34(1)(a) was therefore not met, and the reassessment notices and reassessments were invalid.

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Issues: Whether the reopening of the assessments under section 34(1)(a) of the Indian Income-tax Act, 1922 was valid on the ground that the assessee had failed to disclose fully and truly all material facts necessary for assessment.

Analysis: The governing principle is that the assessee must disclose all primary facts material to the assessment, but is not bound to indicate the correct legal inference or the proper principle of chargeability. Once the primary facts are before the assessing authority, it is for that authority to draw the necessary inferences. On the facts, the assessee had disclosed the existence of the relevant bank account and the receipt of sale proceeds in British India, and the alleged non-disclosure of another account did not amount to suppression of a primary material fact. The escapement of income, if any, resulted from the Income-tax Officer's erroneous view on chargeability, not from non-disclosure by the assessee. The same factual position applied to the later assessment year as well.

Conclusion: The condition precedent for action under section 34(1)(a) was not satisfied, and the reassessment notices and resulting reassessments were invalid.

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