TMI Blog1994 (9) TMI 111X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to newly constituted firm Shri Gopal Pulse Mills (assessee) w.e.f. 10th Nov., 1977 which was constituted by the following: Shri Bansilal Athumal 30% Shri Gopal Bansilal 40% Smt. Janki Tharumal 30% The Assessing Officer found that as per the terms of the partnership deed of the assessee-firm capital was invested and would continue to be invested by all partners with mutual understanding. But no interest would be charged thereon. The godown premises was provided by partner Shri Gopaldas and he would not charge any rent. Factory premises were taken on rent from Shri Tharumal and its tenancy rights would vest in the firm. The Assessing Officer observed that partner Shri Gopaldas gave godown premises for use of the firm as a consideration for sharing profits. Further though Shri Tharumal, husband of Smt. Jankiben was owner of the factory premises but the tenancy rights therein were given to the firm. The Assessing Officer came to the conclusion that the firm as constituted was not genuine for the following reasons : 1. Smt. Jankiben brought in capital of Rs. 85,041 on withdrawal from M/s Bansilal Co. Shri Tharumal husband of Smt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital on becoming partner in the firm M/s Bansilal Co. earlier totaling to Rs. 32,158—Rs. 5,000 gifted by his father Shri Bansilal in S.Y. 2026, Rs. 20,000 gifted by Shri Jethanand in S.Y. 2030 who was found to be benamidar of Shri Bansilal and Rs. 7,158 being accumulated interest from S.Y. 2026 to 2033. The Assessing Officer therefore, held the view that as his capital came directly or indirectly from his father Shri Bansilal Shri Gopaldas was held to be a benamidar of his father Shri Bansilal in the firm M/s Bansilal Co. and on having brought his capital from Bansilal Co. in the assessee-firm he was considered as a consequence benamidar of his father Shri Bansilal. The Assessing Officer also found that the godown was purchased by Shri Bansilal in January, 1968 in the name of Shri Gopaldas for a consideration of Rs. 10,000 and further expenditure thereon was incurred of Rs. 10,000 for addition. Shri Gopaldas, therefore, held the said premises as benamidar of his father and in S.Y. 2034 his father gifted the said premises to Shri Gopaldas. 6. The Assessing Officer thus held the view that Smt. Jankiben was benamidar of her husband Shri Tharumal, Shri Gopaldas was benamida ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e deciding the appeal of Bansilal Co. he did not have the benefit of decision of the Hon'ble Supreme Court in the case of Brij Mohansingh vs. Priya Bret Naren Sinha Ors. AIR 1965 SC 282 dt. 5th Feb., 1964. In this decision the Supreme Court held the view that in actual life it often happens that persons give false age of the boy at the time of his admission to school so that later in life he would have an advantage when seeking public service for which a minimum age of eligibility is often prescribed. The Court of fact cannot ignore this fact while assessing the value of entry and it would be improper for the Court to base any conclusion on the basis of entry, when it is alleged that the entry was made upon false information supplied with the above motive. In view of the aforesaid decision of the Supreme Court school certificate cannot be taken as final and conclusive proof of age and other evidence has to be looked into. In view of the facts given in the decision of the Supreme Court cited supra the first appellate authority held that Shri Gopal was not a minor when he was admitted as full fledged partner in the assessee-firm. 10. As regards the allegation that Shri Gopal w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee on the other hand advanced arguments in support of the order of the first appellate authority and submitted that on the basis of facts and material evidence on record the first appellate authority was justified in treating the firm as genuine and valid and allowing registration for the years under consideration. In support he also relied upon certain decisions. 14. We have carefully considered the rival submissions made by the learned representatives of the Revenue as well as the assessee and gone through the orders of the lower authorities and material evidence on record. We find that the firm M/s Bansilal Co. was initially constituted during the accounting year relevant to asst. yr. 1969-70 by five partners and it had undergone change of constitution almost in each year thereafter upto the asst. yr. 1976-77. Shri Bansilal and his son Shri Tharumal were the main partners. Smt. Jankiben, wife of Shri Tharumal became partner in the firm during the accounting year relevant to asst. yr. 1976-77 with 26% share in profit and loss of the firm and she remained partner for the asst. yrs. 1976-77, 1977-78 and 1978-79. Shri Gopal also became partner during the accounting year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which is to be seen is that whether the profits earned by Smt. Jankiben T. have been enjoyed by her husband Shri Tharumal or any other person. There is nothing on record to show that she is not owner of profits shown by her as a partner. There is no material on record that share of her profits were enjoyed by Shri Tharumal or any other person. It is difficult to hold from gift of Rs. 1,500 by Hotchand Lilaram to Smt. Jankiben that Smt. Jankiben is benamidar of Tharumal. There is no material on record to show that Shri Hotchand Lilaram is benamidar of Shri Tharumal. Thus, I hold that the burden that Smt. Jankiben T. is benamidar of Shri Tharumal Bansilal has not been discharged by the Department." 16. The first appellate authority then examined the question whether Shri Gopal was benami of his father Shri Bansilal in paras 12 and 13 of his order dt. 20th Jan., 1983 and he gave the finding that shri Gopal was a genuine partner and not a benamidar of his father Shri Bansilal with the following observations: "The counsel for the assessee stated that after filing this affidavit, Shri Gopaldas B. was examined on 3rd March, 1981 by the ITO who has made the assessment on 28th March, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on due consideration of all material facts and evidence on record he gave a finding that his correct date of birth was 12th Jan., 1959 and not 1st Jan., 1962. Para 14 of the order is reproduced below: "This brings to the last issue involved in this case, i.e., regarding the age of Shri Gopaldas B. when he was admitted as a partner of the firm. As stated before, even if the ITO is successful in proving that Shri Gopaldas B. was a minor when he was admitted as full-pledged partner, the firm will not be valid and the registration cannot be allowed to such firm. The ITO has given a note dt. 22nd Nov., 1982 to me during the course of hearing of the appeal. First he relied on the statement recorded by the ADI dt. 22nd Dec., 1979 where according to the ITO Shri Gopaldas admitted his age of about 18 years. From the perusal of the statement made by Shri Gopaldas on 22nd Dec., 1979, I find that the only mention of age is written by the ADI but no question is asked to Shri Gopaldas about his age in the statement recorded on 22nd Dec., 1979. I find that the only mention of age is written by the ADI but no question is asked to Shri Gopaldas about his age in the statement recorded on 22nd De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1968, the age of Shri Gopaldas is declared as 6 years. The counsel for the assessee stated that the mention of age in the document dt. 17th Jan., 1968 was a narration of age of only on approximate basis. This is because the age was not material for the said document. The only fact which was material at the relevant time was that Shri Gopaldas was a minor. It was argued on behalf of the assessee that some approximate mention of age in the document cannot take place of correct age or date of birth. The ITO also in his note dt. 22nd Nov., 1982 has mentioned that the birth date as per certificate issued by the school shows date as 1st Jan., 1962. The counsel for the assessee stated that it was by mistake that the age of Shri Gopaldas B. was mentioned in the school certificate as 1st Jan., 1962. The counsel for the assessee on the other hand relied on Chhatti Vahi book, LIC policy wherein the date of birth mentioned is 12th Jan., 1959, Shri Bansilal's affidavit and mother Smt. Gangabai's affidavit, Chhatti Vahi book of the family according to which the date of birth of Shri Gopaldas is 12th Jan., 1959. The counsel for the assessee has heavily relied on the affidavit made by Shri Gopalda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , i.e., on 22nd Nov., 1979. The counsel argued that there was overwhelming evidence in the form of family horoscope book, Shri Gopaldas's affidavit dt. 2nd Feb., 1981, Shri Gopal's cross examination dt. 3rd March, 1981, Shri Gopaldas's affidavit dt. 7th Jan., 1962, Shri Bansilal's affidavit dt. 2nd Feb., 1981, cross examination of Shri Bansilal dt. 28th Feb., 1981, Smt. Gangaben's affidavit dt. 7th Jan., 1982, school leaving certificate of Rajkumari and RTO's driving licence issued on 11th July, 1978 to Shri Gopaldas which go to show the correct date of birth as 12th Jan., 1959. If the date of birth of Shri Gopaldas is taken as 12th Jan., 1959, when he was admitted as a full- fledged partner on 16th March, 1977, he was major being more than 18 years. Thus, on this ground, the firm cannot be held to be invalid and the registration cannot be denied." The first appellate authority after having given such findings allowed registration to the firm M/s Bansilal Co. for the asst. yr. 1978-79. The Revenue preferred a second appeal before the Tribunal against the order of the first appellate authority. The Tribunal in its order dt. 3rd May, 1991 in ITA No. 849/Ahd/83 confirmed the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y him directly or indirectly reached his father Shri Bansilal and he enjoyed its benefits. The other aspects have been considered by the first appellate authority in his order in the case of Bansilal Co. for the asst. yr. 1978-79 where he gave the finding that Shri Gopaldas was not a benamidar of his father Shri Bansilal. On due consideration of all the facts we find ourselves in agreement with the finding given by the first appellate authority to the effect that he was a genuine partner in the assessee-firm. 20. Now we are left with the last ground on which the Assessing Officer refused registration of assessee-firm and that ground was about the date of birth of Shri Gopaldas. The learned first appellate authority started disposal of this controversy by rightly observing that if the ITO is successful in proving that Shri Gopaldas was a minor when he was admitted as full-fledged partner, the firm will not be valid and the registration cannot be allowed to such firm. We accordingly have to go in detail as to what is the evidence on record and to conclude as to what is the actual date of birth of Gopaldas. 21. The undisputed facts are that Gopaldas was a student at the time o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso pointed out that evidence in the shape of LIC proposal declaring the date as 12th Jan., 1959 was also a device to save the assessee-firm from being refused the registration as the date of birth of Gopaldas as shown in school certificate and as being adopted by his parents was proving Gopaldas as minor on the date of constitution of firm. About the driving licence, it is contended by the learned Departmental Representative that this does not help the assessee as it is not essentially required by the person who applies for driving licence. 23. On the basis of above, it is clear that there are two different sets of evidence before us and the one is based on school record as well as sale deed dt. 17th Jan., 1968 which has been made basis by the ITO to conclude the date of birth of Gopaldas was 1st Jan., 1962. Undisputedly it is laid down by their Lordships of the Hon'ble Supreme Court in the case of Brij Mohansingh vs. Priya Bret Naransingh Ors. that it often happens that persons give false age at the time of admission to school so that later in life their children would have an advantage when seeking public service for which a minimum age of eligibility is often prescribed, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wriggle out from the complication about his date of birth which was shown as 1st Jan., 1962 in the school records and by that the constitution of the firm was going to be invalid on account of Gopal being minor. The conclusion is that the assessee was not able to give out any explanation why the date of birth shown in school records is incorrect and thus no benefit to the assessee on the basis of law relied by the assessee-firm. 25. The other circumstance which fortifies conclusion of the ITO is recital in the sale deed dt. 17th Jan., 1968 through which father of Gopaldas purchased properties in the name of his minor son. Before proceeding further, we may point out that men may speak lie but not the circumstance and here it is a circumstance which demolished the whole of the theory of the assessee. In 1968 when the sale deed was got executed by father of Gopaldas Bansilal, the date of birth of Gopaldas was not matter in issue and ordinarily a person will give out the correct date of birth or its estimation. There the age of Gopaldas is shown as six years and it justified the date of birth shown in his school record which is 1st Jan., 1962. In case the date of birth was 12th Jan. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see must be major and that is why licence was issued. It is material to point out that a person who intends to obtain a driving licence, may submit a certificate from medical practitioner who may estimate his age and if it is more than 18 years, he can be issued driving licence. No authentic document confirming his age is required except doctor's report and in case driving licence is issued it does not show that Gopaldas was major on 11th July, 1978. 29. The other evidence is in respect of affidavit of Gopaldas, his father and mother. We have already discussed that important explanations were missing from the affidavit of Shri Bansilal Tharumal. Mother of the assessee has not given the date of birth as evident from the copy of affidavit of Smt. Gangabai. The affidavit of Shri Gopaldas cannot be taken as believable so far as his date of birth is concerned because he is not expected to know the correct date of his birth. 30. The other circumstance is that Rajkumari is younger to Gopaldas and in case the age of Gopaldas is treated as 1st Jan., 1962 Rajkumari will be elder to her elder brother as her date of birth is 5th Jan., 1960. Again this is a fact well within the knowledge ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
