PADHYE, J. - (1.)THIS reference has been made by the Tribunal under S. 66(2) of the Indian INCOME TAX ACT, 1922, on the requisition made by this Court on 24th April, 1962, in IT Appln. Nos. 40, 41, 43, 44, 45, 46 and 47 of 1961. Two questions have been referred by the Tribunal. They are :
"(1) Is there any material on record to hold that the properties and assets standing in the name of Shrimati Surajbai belonged to the assessee family ? (2) Was the Tribunal right in including income that accrued to or arose in the name of Surajbai Daga or that was received by Surajbai Daga in the assessee family's total income ?"

(2.)THE assessee in all these cases was the HUF represented by Ramnath Daga and the assessments are for the asst. yrs. 1947 -48, 1948 -49 and 1952 -53 to 1956 -57. Ramnath Daga was at the material time the Karta of the assessee HUF and Surajbai is his second wife. Previous to these assessment proceedings there were assessment proceedings for the asst. yrs. 1945 -46 and 1946 -47 also. The original assessment for the asst. year 1945 -46 was made on 13th March, 1946. Subsequently proceedings under S. 34 of the INCOME TAX ACT, 1922, were started against the assessee, Seth Ramnath Daga, and notice under S. 34 was served on its Karta on 16th March, 1954. The notice under S. 34 was issued to the assessee as the Department considered that the assessee had escaped assessment and it was discovered that the assessee had not in the original assessment disclosed several amounts and particularly those which stood in the name of the Karta's wife, Surajbai, either in the shape of shares or deposits in the banks or immovable property, such as a house at Ganganagar and a house at Nagpur. The assessee was asked by the Department to explain the sources from which the properties were taken in the name of Surajbai and the amounts invested in her name either in the bank or in shares. Several explanations were given by the assessee and it appears that some account books of the assessee as well as of Surajbai were shown to the ITO. One of the explanations that was given by the assessee with respect to the house at Ganganagar standing in the name of Surajbai and the investments in the banks and in shares was that during the Samvat years 1987 -88 to 1995 -96 an amount of Rs. 3,34,589 was withdrawn by the assessee from the firm, R. B. Bansilal Abirchand, Bikaner, and most of this amount was made over by the Karta to his wife as gifts from him from time to time during that period. An explanation was also given that his wife had also received gifts from her parents and the relations at the time of her marriage and marriages of the relations and on other ceremonies and occasions and the amount was accumulated with the wife. It may be stated at this time that Surajbai is the second wife of Ramnath Daga. He had married one Ratanbai who was the daughter of Mathuradas Mohota of Hinganghat. She died in or about November, 1936, and he married his present wife, Surajbai, in or about April, 1937. Sujrajbai also is the daughter of Mathuradas Mohota and the younger sister of his first wife, Ratanbai. It was also alleged by the assessee that the assessee also withdrew an aggregate amount of Rs. 1,38,142 which were handed over by the Karta to his wife for defraying household expenses and out of that sum, his wife, according to him, must have made some savings. In the year 1939, Surajbai opened her own account books and credited an amount of Rs. 2,00,000 in her account books. It is out of this amount of Rs. 2,00,000 it is alleged that the house at Ganganagar was purchased and the deposits were made in the banks and the shares were purchased. This amount of Rs. 2,00,000 is said to be from these various sources which have been stated earlier. During those proceedings the assessee was given several adjournments to prove his case and the assessee is said to have produced the books of the firm relating to Samvat years 1987 -88, 1988 -89 and 1995 -96 which showed a very small amount of withdrawals as compared to the sum of Rs. 3,34,589. The explanation which was given by the assessee was not accepted by the learned ITO for which he gave his own reasons in his order dt. 18th Jan., 1955. To put the reasons in his own words, he says :
"I cannot accept that for years together the assessee was keeping huge idle funds at home which was both uneconomic and risky. The assessee was paying heavy interest to the firm on the withdrawals. The funds could have been deposited in bank and could be a source of substantial recurring income. The investments are mostly made during the period of war when merchants reaped huge profits from different sources. The assessee has huge speculative business. It is also not possible to connect any particular withdrawals with a succeeding investment made in the name of Smt. Surajbai. Moreover, the withdrawals must have been made for some specific purpose and spent over it. There is also no personal account of the lady or any central set of account books to show as to how the amounts withdrawn were expended and how much of the withdrawals remained with the assessee so as to be available for investment in the name of the lady. Even there is no record to show the source of monies alleged to have been received by the lady on ceremonial occasions. As a large sum was alleged to have been received by the lady on different occasions, it should have been possible for the assessee to produce some evidence on the point. There is no evidence to indicate that any gift was made to the lady. This being the case of an HUF, even the Karta could not make any gift out of the HUF funds. The withdrawals from the firm were the property of the HUF."

Before the ITO the assessee had produced a book belonging to Surajbai in which the amount of Rs. 2,00,000 was shown to have been credited in the name of Surajbai. The ITO, however, did not accept this account book as a reliable one and came to the conclusion that there was nothing to show conclusively that the assessee or Surajbai had an amount of Rs. 2,00,000 in Samvat year 1996 at home as contended by the assessee.

(3.)A similar notice was issued to the assessee under S. 34 of the IT Act with respect to the asst. yr. 1946 -47. During this period another amount of Rs. 1,50,000 also came for consideration. Explanations were given by the assessee in these proceedings also and so far as the amount of Rs. 1,50,000 is concerned, it was contended that this amount was transferred to her from the capital account of the assessee, Seth Ramnath Daga, on Kartik Badi Asthami 2001, which corresponds to 9th Oct., 1944. With respect to the other amount of Rs. 2,00,000, a similar explanation which was given earlier, was given. For the asst. year 1945 -46 an amount of Rs. 30,000 was added as being the income from an undisclosed source. It was found during that year that an investment of Rs. 30,000 was made during that year in the name of Surajbai. This was composed of two amounts, namely, Rs. 10,000 on 13th Feb., 1945, and Rs. 20,000 on 21st Feb., 1945. Rs. 10,000 was said to be an amount paid as earnest money on 13th Feb., 1945, for the purpose of a house at Nagpur and the amount of Rs. 20,000 was paid on 21st Feb., 1945, for a similar purpose but during the asst. year 1946 -47 an amount of Rs. 1,19,555 was added as income from an undisclosed source.
These assessments were confirmed in appeals to the AAC and the Tribunal. The Tribunal proceeded on the basis that the burden of proving the advancement or gift lies on the person alleging that there was advancement or gift and there was no presumption in favour of advancement or gift such as is there in the English law. He found that there was no material on record to show that the Karta's wife was possessed of funds of her own to make the impugned investments. The Tribunal referred to the different explanations and the stand taken by the assessee with respect to these investments and also referred to the entries in the account books of the firm and observed that no mention was made of any gift of Rs. 1,50,000 by the Karta to his wife out of his capital in the Bikaner books. In view of the explanations given by the assessee which, according to the Tribunal, were varying and the improbability of the story put forward, the absence of satisfactory explanation for the wife to start an account book all of a sudden in Samvat year 1996 and in the absence of any material to show that the wife of the Karta was possessed of funds of her own, the Tribunal confirmed the assessment made by the ITO as confirmed by the AAC. Similar view was taken for the asst. year 1946 -47 also.