The onus of proving that the assessee had omitted or failed to make a return under section 139 of the Act or had omitted or failed to disclose fully and truly all material facts necessary for assessment for that year, as a result of which income chargeable to tax had escaped assessment for that year, lay upon the Department.

1. - D.B. Income-tax Cases Nos. 78, 79, 80, 81, 82, 83, 85, 86, 87, 88, 89, 90, 91, 92, 93, 97 and 98 of 1973 were decided by a common judgment passed by this court on December 14, 1976, as common questions of law arose in all the aforesaid cases. This court was pleased to direct the Income-tax Appellate Tribunal to draw up a statement of case and refer the question of law as given in its order to this court along with a statement of case for the assessment years 1955-56 to 1961-62 (Reference Case No. 102 of 1979). Similarly, this court, vide its order dated August 2, 1977, directed the Tribunal to draw up a statement of case and refer questions of law for the opinion of this court with respect to the assessment year 1966-67 (Reference Case No. 17 of 1978). By the same order dated August 2, 1977, this Court directed the Tribunal to draw up a case and refer the question of law for its opinion for the assessment year 1968-69 (Reference Case No. 18 of 1978).

2. The Income-tax Appellate Tribunal (hereinafter referred to as "the Tribunal") by its order referred the following three identical questions of law for the assessment years 1955-56 to 1963-64:

"(1) Whether, on the facts and in the circumstances of the case, action under section 147 was validly commenced ?

(2) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in the conclusion that the business of M/s. Radhey Shyam Hari Narain and M/s. Temani Trading Company belonged to the assessee-Hindu undivided family without finding any evidence that the funds invested in that business flowed from Hindu undivided family on the mere ground that the partners were not able to explain their investment satisfactorily and the Tribunal based its conclusion on mere presumption and in disregard of the dictum that 'apparent is real unless otherwise proved differently' ?

(3) Whether, on the facts and in the circumstances of the cage, the Tribunal was justified in holding that the assessee has deliberately concealed particulars of its income and thus the assessee was liable to penalty under section 271(1)(c) ?"

3. In respect of the assessment year 1966-67, the Tribunal referred a similar question which has been referred under question No. (3) above. In respect of the assessment year 1968-69, the following question was referred:

"Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding the assessee guilty and imposing a penalty under section 273(1)(a) of the Income-tax Act for the assessment year 1968-69 ?"

4. The assessee in these cases is a Hindu undivided family carrying on business in the name of M/s. Prahlad Maliram. The Income-tax Officer, D-Ward, Jaipur, issued notices under sections 147 and 148 of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), for reopening the assessment on the ground that the partnership firm carrying on their business in the name and style of M/s. Radhey Shyam Hari Narain and M/s. Temani Trading Co. were the offshoots of the assessee-firm and, therefore, their income should have been clubbed with the income of the assessee. According to the Income-tax Officer, the business of these two firms, namely, M/s. Radhey Shyam Hari Narain and M/s. Temani Trading Co., was carried on by the coparceners of the Hindu undivided family and, therefore, their income should have been taken as the income of the assessee-firm. The Income-tax Officer while assessing the firm assessed the income by clubbing the income of M/s. Temani Trading Co. with the income of the assessee-firm. The assessee took up the matter before the Appellate Assistant Commissioner of Income-tax who rejected the appeal of the assessee and concurred with the finding given by the Income-tax Officer. In separate proceedings commenced under section 271(1)(c)/274(2) of the Act, the Inspecting Assistant Commissioner came to the conclusion that concealment of income had taken place on the assessee's part in furnishing i