TMI Blog1975 (3) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... UDGMENT The judgment of the court was delivered by CHANDRACHUD J.-- The assessee-firm, M/s. Radha Kishan Nandlal, which is respondent to this appeal consists of three partners, Subhkaran Jhunjhunwalla, having an 8 annas share and two others having each a 4 annas share therein. In the course of the assessment for the years 1950-51 and 1951-52, the Income-tax Officer found that another firm, M/s. Radhakissen Nandlal Arhatwalla, was a branch of the assessee-firm. Accordingly, he included the income of that firm in the hands of the assessee-firm for those years. During the assessment proceedings for the year 19 52-53, the year under reference, the Income-tax Officer on the basis of the past records intended to include the income of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income of the branch firm which could be included in the assessee's income would come to a sum of Rs. 75,000 only. The appellant the Commissioner of Income-tax, West Bengal II, Calcutta, thereafter filed an application under section 66(1) of the Indian Income-tax Act 1922, asking the Tribunal to refer to the High Court two questions of law said to arise out of its judgment. The Tribunal rejected that application. The appellant thereafter filed an application in the High Court of Calcutta under section 66(2) of the Act praying that the Tribunal be asked to refer the two questions to the High Court. The High Court granted a rule on that application but discharged it without a speaking order. This court gave to the appellant special lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal also attempted to make an estimate of the income of the branch firm on the basis of the advances made to it by the assessee-firm. In the accounting years relevant to the assessment years 1950-51 and 1951-52, such advances amounted to Rs. 30 lakhs odd and Rs. 64 lakhs odd, respectively. The profits assessed for those years were respectively Rs. 33,000 odd and Rs. 1 lakh odd. The advances made by the assessee-firm to the branch firm for the relevant year being Rs. 58 lakhs odd, the Tribunal thought that it did not stand to reason that even though the advances made for the relevant year were less than the advances made for the assessment year 1951-52, the profits of the relevant year could be estimated at nearly Rs. 9 lakhs, that is to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that a finding based on no evidence results in an error of law. The judgment of the Tribunal thus raises the questions whether it misdirected itself in law in basing its conclusion on some evidence ignoring the other essential matters on record and whether the conclusion to which it came is such as no reasonable person could have come to. It is necessary that these questions should be decided by the High Court. We might mention that the High Court was not right in discharging the rule without giving any reasons (See Commissioner of Income-tax v. Daulatram Rawatmall ). Accordingly, we direct the High Court to call for a reference from the Tribunal on the two aforesaid questions and to deal with the reference in accordance with law. C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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