TMI Blog1979 (2) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... representative of the deceased partner was inducted into the firm. The other partners and their shares remained unaltered. In respect of the assessment year 1962-63, by an application dated the 23rd May, 1963, filed under s. 184(7) of the I.T. Act, 1961, the partners of the firm as constituted by the earlier deed applied for continuation of the firm's registration for the period from the 1st April, 1961, to the 31st July, 1961, and by another application dated the 12th March, 1962, under s. 26A of the Indian I.T. Act, 1922, the partners of the new firm applied for registration for the period from the 1st August, 1961, to the 31st March, 1962. Inasmuch as the Indian I.T. Act, 1922, stood repealed on and from the 1st April, 1962, the partn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nors, the nephew and niece of the former, should be admitted to the benefits of the partnership, Anandilal Poddar did not intimate to the guardian of the minors about the same by oversight and, consequently, the guardian did not include the share of the income of the firm in the returns of the minors. The ITO found that such oversight persisted for over nine years though the guardians of the other minors admitted to similar benefits in the said firm were duly informed of the same and the income of the said minors from their share of the profits of the firm were duly declared in their income-tax assessments. He noted that the disclosure petitions were submitted on the 7th October, 1966, under s. 271(4) by Basudeo Kanoria on behalf of the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e minors to the capital of the partnership was irrelevant particularly when there were other minors similarly admitted to the benefits of the partnership without any such contribution. The discrepancy in the quantum of shares of the partners was also irrelevant as the same was a matter of agreement. The continued retention of the minors' shares of profit in the firm was also not relevant in deciding the genuineness of the firm. Such facts might give rise to suspicion but were no proof that the firm was not genuine. It was contended on behalf of the revenue on the other hand that, in the facts and circumstances, the conclusion that the said minors were in fact not admitted to the benefits of the partnership and that the assessee was not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances of the case, the Tribunal was right in holding that the partnership, though legal, was not genuine ?" It appears to us that the questions whether a partnership firm is genuine or not or whether the partnership firm at all came into existence or not are ex facie questions of fact. The conclusion of the Tribunal that the assessee was not a genuine partnership firm has not been challenged by the assessee as perverse or based on no evidence. None of the primary facts found by the Tribunal, on which such conclusion is based, has also been challenged. Mr. R. N. Bajoria, learned counsel for the assessee, drew our attention to the following decisions of the Supreme Court : Krishna Flour Mills v. CIT [1962] 44 ITR 501, where the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecision of the Tribunal would be final and no reference to the High Court would lie under section 66. A reference to the High Court lies only on a question of law. " In the instant case, it is apparent that the controversy is one on facts. There is no dispute that legally it was possible to admit the minors to the benefits of the partnership. We are not inclined to accept the suggestion of Mr. Bajoria that we should reframe the question referred on the lines of the question before the Supreme Court in Krishna Flour Mills' case [1962] 44 ITR 501. For the above reasons, the reference is disposed of by answering the question in the affirmative and in favour of the revenue. There will be no order as to costs. C. K. BANERJI J.--I agree. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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