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Commissioner of Income-tax, West Bengal Vs. Brijlal Lohia and Another. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtKolkata High Court
Decided On
Case NumberIncome-tax Reference Nos. 140 to 143 of 1962
Reported in[1967]66ITR97(Cal)
AppellantCommissioner of Income-tax, West Bengal
RespondentBrijlal Lohia and Another.
Cases Referred and Raja Mohammad Amir Ahmad Khan v. Commissioner of Income
Excerpt:
- banerjee j. - under an order of this court, a statement of case of on the following question of law was made by the appellate tribunal :'whether, on the facts and in the circumstances of the case, the findings of the tribunal that the gifts alleged to have been made by the assessee to his brother, brijlal lohia, and his nephew, nandkishore lohia, were validly made and that the business of brijlal nandkishore did not belong to the assessee were perverse in the sense that no reasonable man would come to the findings on the material on record ?'facts, in so far as necessary for answering the question, are hereinafter stated brief.the assessee, kanailal lohia (alias kanhaiyalal lohia), now deceased, used to be assessed as an individual. his estate is represent before us by khemka. on july 12,.....
Judgment:

BANERJEE J. - Under an order of this court, a statement of case of on the following question of law was made by the Appellate Tribunal :

'Whether, on the facts and in the circumstances of the case, the findings of the Tribunal that the gifts alleged to have been made by the assessee to his brother, Brijlal Lohia, and his nephew, Nandkishore Lohia, were validly made and that the business of Brijlal Nandkishore did not belong to the assessee were perverse in the sense that no reasonable man would come to the findings on the material on record ?'

Facts, in so far as necessary for answering the question, are hereinafter stated brief.

The assessee, Kanailal Lohia (alias Kanhaiyalal Lohia), now deceased, used to be assessed as an individual. His estate is represent before us by Khemka. On July 12, 1943, the assessee, Kanailal Lohia, gave Rs. 5,11,101 to his brother Brijlal Lohia, by way of gift. Out of the above sum, an amount Rs. 5,00,000 was paid by cheque and the balance was paid in cash. Similarly, on September 30, 1943, the assessee gave Rs. 2,50,000 to his nephew, Nandkishore Lohia, son of Brijlal Lohia, by way of gift. Thereafter, Brijlal and Nandkishore Lohia started a partnership business, some time in August 1943, under a partnership deed dated August 8, 1943, the firm name being Brijlal Nandkishore. In the said partnership, they invested the money received by them from the assessee. The firm, Brijlal Nandkishore, was granted registration under the provisions of section 26A of the Income-tax Act, 1922, because the Income-tax Officer found no reason to doubt the genuineness and the reality of the firm. This partnership used to carry on business in jute, jute baling and shipping, being the same business which the assessee used to carry on.

For the assessment years 1945-46 and 1946-47, the Income-tax Officer had assessed the assessee to tax. Thereafter proceedings under section 34 of the Indian Income-tax Act, 1922, were taken against the assessee because the Income-tax Officer, Non-companies E. P. T. District, felt that the income earned by the firm, Brijal Nandkishore, was actually the income of the assessee, on the theory that the gift was sham show. The Income-tax Officer ultimately included the income of the said firm, for those years, in the income of the assessee. Aggrieved by the order, the assessee preferred an appeal before the Appellate Assistant Commissioner, who set aside the assessment in the view that the gift made by the assessee had been widely made and that Brijlal Nandkishore firm was all together a separate entity with which the assessee had nothing to do. Thereupon, the revenue appealed against the appellate order before the Income-tax Appellate Tribunal. The Tribunal took a different view, set aside the order of the Income-tax Officer. The reasons which weighed with the Tribunal in coming to the conclusion that the gift was not a real gift appear from the following extracts from the judgment of the Tribunal, which we set out below :

'(1) The assessee stated that the gift was made in the presence of respectable persons and on of them was Mr. Amrita Lal Majumdar. Sri A. L. Majumdar was examined by the Income-tax Officer on the 28th March, 1950, and the stated that no such gift was made in his presence. Of the other persons named by the assessee, in the gift was made, one could not be examined (probably because he was dead by that time) and the other two were not produced before the Income-tax Officer.

(2) The first donee, namely, Brijlal Lohia, was 53 years of age on the date of the alleged gift and the age at which Brijlal Lohia was made a donee made the gift look unreal. Further, the subsequent gift of Rs. 2,50,000 to Nandkishore was not in keeping with the intention of the donor who wanted to help the two donees, inasmuch as a gift having already been made earlier, there was no necessity for the second gift to Nandkishore Lohia.

(3) The donor, namely, the assessee, did not produced himself before the Income-tax Officer to explain the circumstance under which he felt the necessity to make provision for his brother and nephew by giving away so large a sum as gift.

(4) The donors total assets were only to the extent of Rs. 9,75,090 and, as such, the gift of about Rs. 8,00,000 out of the said assets looked improbable.

(5) The intention of making a gift was disproved by the circumstance that the donor had to take on overdraft of 2 lakhs of rupees to make a gift of Rs. 5 lakhs.

(6) Out of the money received on gift, Brijlal Lohia and Nandkishore Lohia started carrying on the same business which was previously run by the assessee himself.

(7) In the assessment year 1945-46, the income derived from the business run by the donees was not distributed amongst the two, although they professed to be partners.

(8) The assessees brother and nephew were probably benamidars for the assessee.

On the aforesaid reasons, the Tribunal came to the conclusion that the business of Brijlal Nandkishore was really owned by the assessee, Kanhaiyalal Lohia, and therefore, its income was rightly include by the Income-tax Officer in the income of the assessee. Thereafter, on the prayer of the assessee, the following question was referred to the High Court, under section 66(1) of the Income-tax Act :

'Whether in the circumstances of this case, where the Income-tax Officer, District III (2), separately assessed the business run in the name of Brijlal Nandkishore as belong to a partnership firm consisting of Brijlal and Nandkishore, the Income-tax Officer, Non-Companies E. P. T. District, can assess the income from the same business in the hands of the assessee ?'

Dr. Radhabinode Pal, who appeared on behalf of the assessee, at that stage, made the following candid concession, namely that if a former assessment had in fact been made on a mistaken basis, he did not see why the Income-tax Officer, dealing with the assessment of the assessee, could be said to have no jurisdiction to bring the income under assessment in his hands. So far as the question of the jurisdiction of the second Income-tax Officer was concerned, no legal objections could possibly be taken to it. Dr. Pal accordingly, conceded that the question referred, taken as a pure question of law, could only be answered in the affirmative.

In view of the concession made by Dr. Pal, this court did not pronounce any decision upon the validity of the gifts or the ownership of the firm of Brijlal Nandkishore but answered the question in the affirmative, regard being had to the nature of the concession made on behalf of the assessee.

Having failed to obtain a judgment on merits, the assessee applied for special leave against the order of the Income-tax Appellate Tribunal, before the Supreme Court, under the provision of article 136 of the Constitution and obtain special leave to appeal. The Supreme Court dismissed the appeal. It is necessary for us to set out certain extracts from the judgment of the Supreme Court, because it was contended before us that the said judgment must be deemed to have concluded the question which was need answer in this reference. Their Lordship observed :

'In the present case, the order of the High Court on the question referred was not brought before this court by the ordinary mode indicated in the Indian Income-tax Act, presumably because of the concession of counsel. The attempt is to bring this case within the ratio of Dhakeswari Cotton Mills case and in support, it has been pointed out mainly that the examination of Sir A. L. Majumdar in the absence of Kanhaiyalal Lohia was against the principles of natural justice. The statement of Sir A. L. Majumdar was taken on March 28, 1950, and it is recorded as follows :

Mr. Majumdar is questioned by me as to what he knows regarding the alleged gift as recorded in the books of Kanailal Lohia in favour of Brijlal and Nandkishore. He says that I dont remember things very distinctly but I can say that the gifts to Brijlal or Nandkishore were not made in my presence as allege. Mr. Kanailal Lohia used to tell me that his brother and nephew are idling away their time, hence I shall give them a gift and make them work by that money.

The partnership deed was most probably drawn up by me. The gift was reported to have been made to Brijlal and Nandkishore before I should have taken up the drafting of the deed. Kanailal told me several times that he wanted to separate his brother and nephew. When the firm was started then Brijlal came to me and asked me if father and sons partnership deed could be drawn up.

I dont know anything else than this in the matter.

The lie given by Sir Majumdar to the statement of Kanhaiyalal Lohia has affected its credibility. The order-sheet shows that Mr. B. Sen Gupta took a copy of Sri Majumdars statement and expressed a desire to cross-examine him; but when opportunity was given, he failed to appear. It is impossible to think, in these circumstances, that there has been any breach of the principles of natural justice.

It was contended before us that the finding of the Tribunal was perverse, and that, on an examination of the total circumstance it is quite clear that the gifts were not only real, but were acted upon. This was a matter within the jurisdiction of the Appellate Tribunal as the final fact-finding authority. The Tribunal acted within its powers in refusing to accept the evidence tendered, and, looking at the circumstance of the case, we cannot say that the finding has been perversely reached.

For a number of years, the brother and the nephew were supported by Kanhaiyalal Lohia and it does not appear that a gift of even a small amount was made to them to put them on their legs. Suddenly, in the year 1943, Kanhaiyalal Lohia made up his mind to put them in business with gift of the order of Rs. 7,60,000 and odd. For this purpose he had to overdraw his accounts with the band and pay interest to the bank. It does not appear why he felt that the establishment of his brother and nephew in business should be made on such a grand scale which involved him in debt. This circumstance taken with the fact that Mr. Majumdar stated that he had always complained that they were good for nothing and were idlers, makes the transaction suspicious. It was presumably done with a view to reduce the assessable profits in the hands of Kanhaiyalal Lohia and on the evidence the Tribunal was entitled to hold, as it did, that this was a sham transition. In our opinion no special circumstance exist on which the appellant can claim to come to this court against the decision of the Tribunal and bypassing the decision of the High Court on the question referred and the refusal of the High Court to call for a statement of the case from the Tribunal on the question which the Tribunal refused to refer to the court. The appeals are, therefore, within the rulings of this court in Chandi Prosad Chokhani v. State of Bihar and Indian Aluminium Co. v. Commissioner of Income-tax and must be recorded as incompetent.'

This closed the first chapter of the resistance by the assessee against the attempt of the revenue to have the income of Brijlal Nandkishore firm included in his own income.

While the proceedings for the years 1945-46 and 1946-47 were being fought out, the Income-tax Officer of the assessee made assessment for the assessment years 1947-48 to 1950-51 and included the income of the firm, Brijlal Nandkishore, in the income of the assessee. This he did, even though the assessee had produced before him additional materials showing why the income of the firm, firm, Brijlal Nandkishore should not be included in the income of the assessee. The assessee field appeals against these assessments before the Appellate Commissioner, who dismissed by the arguments of the assessees representative and also because the case of the assessee had been fully considered by the Appellate Tribunal, on similar arguments for the years 1945-46 and 1946-47, and were rejected by the Tribunal. Thereupon, the assessee preferred a second appeal before the Income-tax Appellate Tribunal. The Tribunal this time went through the entire evidence, including the additional evidence produced before the Income-tax Officer, and allowed the appeal by the assessee. The grounds upon which the Tribunal passed a judgment in favour of the assessee, as appears from the summary of the judgment, in the statement of case, were :

'(a) On going through the capital account and the wealth statement of the assessee, the Tribunal found that before making this gift to the said persons the total amount standing to his credit were as follow :

(i) A sum of Rs. 16,79,223 and Rs. 61,968 as the balance left over to his credit in his profit and loss account.

(ii) A sum of Rs. 6,32,804 being his credit balance in his capital account in the partnership business styled Kanailal Lohia (Jute Press). These items, namely, in (i) and (ii), and taken together, worked out of Rs. 23,73,995.

(iii) House properties whose value had been estimated at Rs. 19,00,000.

(iv) Besides these, the assessee had certain further assets which had remained undisclosed till the year 1951, valued at over Rs. 20,00,000.

The Tribunal accordingly held that the assessees financial position was such that he was capable of making gifts to his brother and nephew totaling a sum of Rs. 7,61,101.

(b) The donees after having received the gifts had deposited the said amounts with the National City Bank of New York, which bank certified that it was the account of a firm whose partners were Messer. Brijlal Lohia and Nandkishore Lohia and it was those persons only who were authorised to sign for and on behalf of the said firm. There were other banks also with whom the said two partners of the said firm had opened up accounts and they had also certified to the same effect.

(c) Affidavit, dated the 8th September, 1954, sworn by the assessee, in which he had stated that he had given Rs. 5,11,101 and 2,50,000 to his brother, Brijlal Lohia, and nephew, Nandkishore Lohia, respectively, and that he had no concern, right, title or interest whatsoever in the aforesaid gifted money or any business carried on by his said brother and nephew.

(d) Letters from Jwalaprasad Bhartia and Kashiram Lohia, who were persons in the know of the factum of the making of the gifts and testified that in fact the assessee had gifted the aforesaid amounts to his brother and nephew.

(e)..... that the assessee had no issue and having enough to spare, he was making charities of substantial amounts to various institutions. Such of the institutions of whom the assessee had given donations were (i) Lohia Charity Trust, wherein a sum of Rs. 1,26,000 was donated; (ii) K. L. Lohia Charity Trust to which Rs. 2,00,000 had been donated, and (iii) Lohia College, which received Rs. 2,03,000 as donation from the assessee.

The Tribunal then went into consideration of the evidence in support of the fact as to whether the firm, Brijlal Nandkishore, was a separate entity. In this respect the following evidence was considered :

(a) Registration of the firm, Messrs. Brijlal Nandkishore, under section 65 of the Indian Partnership Act with the Registrar of Firms, on the 23rd December, 1948;

(b) Sales-tax Registration Certificates showing the two partners, namely, Brijlal Lohia and Nandkishore Lohia as partners of the firm known as Messrs. Brijlal Nandkishore;

(c) The affidavit dated 8th September, 1954, sworn by the assessee stating therein that he had given Rs. 5,11,101 and Rs. 2,50,000 to his brother, Brijlal Lohia, and nephew, Nandkishore Lohia, absolutely and that he had no concern, right, title or interest whatsoever in the aforesaid gifted money or in any business carried on by his said brother and nephew;

(d) Entries in the account books of the firm, Messrs. Brijlal Nandkishore showing that a profit and losses of the business had been distributed between the two partners in accordance with their shares each year starting from the first accounting year of the said business;

(e) Copies of the personal accounts of Brijlal Lohia and Nandkishore Lohia in the books of the partnership to show that the gifted amount was introduced by them as their capital in their partnership business and the withdrawals made by them out of the business were so negligible that it carried no meaning in saying that the profits from their business were being indirectly diverted to the assessee under the guise of these withdrawals

(f) The assessee exercised no control at all either over the money gifted or the partnership business and had unequivocally given out an affidavit, adversely to his interest, that he had absolutely no interest in them.'

On these materials the Tribunal came to the conclusion, different from what another Tribunal had arrived at for the years 1945-46 and 1946-47, that gifts were real and that the business of Brijlal Nandkishore was a separate business and the income of that business should not be tagged to the income of the assessee. The assessee had to run a long race to establish this point of view and ultimately did establish the same. As we have stated above, against the order made by the Tribunal, the revenue obtained a reference to this court on the question quoted at the beginning of this judgment.

Mr. Pal, learned counsel for the revenue, made a two-fold submission before us. He submitted, in the first place, that the findings of the Tribunal, although based on certain materials, suffered from the infirmity that they excluded from consideration certain other important materials, particularly the evidence of Mr. Amritlal Majumdar, which evidence, according to the judgment of the Supreme Court, belied the story of the assessee. He contended, in the next place, that the judgment of the Supreme Court, pronounced in respect of the years 1945-46 and 1946-47, concluded the matter and must be taken to have decided that the story of gift must be disbelieved and the business of Brijlal Nandkishore must be held to be a benami business of the assessee and the income of that business should be held to have been correctly added to the income of the assessee.

Before we consider the argument of Mr. Pal, we need make one position clear. In the question referred to this court, as herein before quoted, the language used was -'Whether the gifts alleged to have been made by the assessee to his brother, Brijlal Lohia, and his nephew, Nandkishore Lohia, were validly made ?' This was, by agreement, said to mean whether the gifts had been 'really' made. No question about the invalidity of the gifts, by reason of the incapacity of the parties or want of legal formalities, was agitated before us nor was it argued that the judgment of the Supreme Court between the parties operated as res judicata and that this court must hold, on the basis of the Supreme Court judgment, that the gift was an unreal gift.

Now, it is well-settled by several judgments of the Supreme Court that where a Tribunal comes to a finding on consideration of evidence, that finding is binding upon this court, although, on those pieces of evidence, this court might not come to the same conclusion. We need refer, in this context, to the judgment of the Supreme Court in Sree Meenakshi Mills Ltd. v. Commissioner of Income-tax, in which it was observed :

'On these facts, Tribunal came to the conclusion that the contentions of the department had been fully established, namely, that the intermediaries were dummies brought into existence by the appellant for concealing its profits, that the sales standing in their names were sham and fictitious and that the profits ostensibly earned by them on those transactions were, in fact, earned by the appellant, and should be added to the amounts shown as profits in its accounts. The point for decision is whether there arises out of the order of the Tribunal any question which can be the subject of reference under section 66(1) of the Act. Under that section, it is only a question of law that can be referred for decision of the court, and it is impossible to argue that the conclusion of the Tribunal is anything but one of fact. It has been held on the corresponding provisions in the English income-tax statutes that a finding on a question of fact is open to attack as erroneous in law only it is not supported by any evidence, or if it is unreasonable and perverse, but that where there is evidence to consider, the decision of the Tribunal is final even though the court might not, on the materials, have come to the same conclusion if it had the power to substitute its own judgment.'

The same view appears to have been reiterated by the Supreme Court in Sovachand Baid v. Commissioner of Income-tax, G. Venkataswami Naidu & Co. v. Commissioner of Income-tax and Raja Mohammad Amir Ahmad Khan v. Commissioner of Income-tax.

Mr. Pal did not, as he could not, dispute the above proposition. He, however, submitted that the Super Court was impressed by the evidence of Amritlal Majumdar and went to the length of observing that the lie given by Majumdar to the statement of Kanhaiyalal affected the credibility of the story. The Tribunal took into consideration a good many materials but, he submitted, did not take into consideration the evidence of Mr. Majumdar, which was a very important piece of evidence. He, therefore, submitted that because of the non-consideration of an important pieces of evidence, the Tribunal erred and where the finding was based on non-consideration of important pieces of evidence, a question of law did arise and, under such circumstances, this court would be entitled to review the entire evidence for the purpose of finding out what reference should be drawn therefrom.

Mr. R. Choudhuri, learned counsel for the assessee, did not dispute the above proposition of Mr. Pal as a proposition of low but the submitted that the Tribunal was not oblivious of the evidence of Mr. Majumdar and did notice that evidence in their judgment. He invited our attention to the following passage from the judgment of the Tribunal :

'It is also submitted that the gifts themselves remained unproved inasmuch as of the persons who would have spoken whether the gifts had been made, none was produced by the assessee before the Income-tax Officer and the one who came forward, Mr. A. L. Majumdar, did not support the assessee inasmuch as he said I dont remember things very distinctly but I can say that the gifts to Brijlal or Nandkishore were not made in my presence as alleged.'

In our opinion, there is considerable force in the submission made by Mr. Choudhuri. We are also of the opinion that the Tribunal did not shut their eyes to the evidence of Amritlal Majumdar and were conscious of the fact that the revenue was very much depending upon that evidence to show that the story of the gift by the assessee to his brother and nephew should be condemned as a mere story. But, as the Tribunal observed, the other pieces of evidence now produced were weightly enough to dislodge the weight of evidence of Amritlal - this appears from the following finding of the Tribunal, which we set out below :

'The question then remains as to whether upon the evidence which is now before us we could come to the conclusion that the gift were valid and that the business, Brijlal Nandkishore, did not belong to the assessee. The various documents, evidence and circumstances placed on behalf of the assessee, mentioned and discussed above, are so convincing and complete in their nature that we are satisfied that the gifts had been validly made and it further shows that the business known by the firm name, M/s. Brijlal Nandkishore, belonged to the partners, Brijlal Lohia and Nandkishore Lohia, and that the assessee had no right, title, interest or concern with the said business.

There could be no element of the said partners being benamidars for the assessee inasmuch as there is no evidence of any control having been retained by the assessee over the money gifted or over the business done by the two donees. The departments case is, in fact, base mainly on suspicion and not on evidence. However strong the suspicion be, that could never play the part of evidence, is a well-settled proposition.'

In our view, the ground on which Mr. Pal wants us to go behind the finding of the Tribunal cannot be sustained. We have before us a case in which the Tribunal noticed the respective contentions of the parties and also took note of the evidence, which was for and the evidence which was against the version of the assessee. Having weighed the evidence of the balance, the Tribunal came to the conclusion that the evidence in support of the version on the assessee was weighter than the evidence against the version of the assessee. In such circumstances, where the finding of the Tribunal was based on evidence, it is not possible for this court to go behind the finding and come to a finding of its own on those materials.

We propose to indicate in brief the way in which the assessee sought to mend the lacuna in evidence, which he had produced before the Tribunal dealing with his case for the years 1945-46 and 1946-47. One of the comments made against the assessee was that he did not produce the other witnesses in whose presence the gift had been said to have been made. the other witnesses, in whose presence the gift was made, were Jwala Prasad Bhartia and Kashi Ram Lohia. This is not disputed by Mr. Pal, who ascertained their names from the records in his possession. Since their absence had been commented upon on the previous occasion, the assessee took the precaution of producing letters from them supporting the assessees version that the gift had been made in their presence. Further, there was produced and affidavit by the assessee affirming that he had made a gift of Rs. 7,61,000 to his brother and his nephew and that he had no concern with the business, Brijlal Nandkishore, started with that money. Also, the assessee caused production of the personal accounts of Brijlal Lohia to show that the amount gifted by him was introduced in the partnership business. Lastly, the assessee also caused production of the business accounts of the firm, Brijlal Nandkishore, showing that the profits and losses of the business of Brijlal Nandkishore were distributed amongst the two partners, in accordance with the provisions of the partnership deed. The additional facts now produced are important facts, the absence of which, on the previous occasion, went against the version of the assessee and the presence of which in the instant occasion added support to the version of the assessee.

Another important fact was introduced on the present occasion. On the previous occasion, the assessee could not prove the total value of his wealth. Somehow or other, the revenue authorities proceeded on the assumption that the total assets of the assessee could be valued only at Rs. 9,75,000 and out of that a gift of about Rs. 7,61,000 was an unbelievable performance. The assessee this time took the precaution of showing that he was rich enough to throw away a sum of Rs. 7,61,000, by way of gift, because his total wealth came up to about Rs. 62,73,995 if not more. Now, we have materials before us showing that the assessee was a rich enough person, at least for the purpose of making a gift of about Rs. 7,00,000 and odd. We have before us the further fact that the assessee was childless and had throughout maintained his brother and nephew. We have also materials before us showing that the assessee was a charitably disposed person and did make other public charities. In these circumstances if the Tribunal came to the conclusion that the assessee had made a gift of Rs. 7,00,000 and odd to his near and dear relatives, the finding cannot be characterised as a perverse finding.

The Tribunal also took into consideration a number of facts which went to show that the business started by Brijlal and Nandkishore with the money gifted to them, by the assessee, was a separate business, with which the assessee had no concern, namely, the registration of the firm under section 65 of the Indian Partnership Act, registration of the firm under the Bengal finance (Sales-tax) Act, an affidavit of the assessee, entries in the account books of the firm, Brijlal Nandkishore, and statements from the banks of the firm. These are good enough materials on which to come to a finding that the business, Brijlal Nandkishore, was a separate business, with which the assessee had no concern. Such a finding cannot be characterised as baseless, without any evidence whatsoever or a perverse finding and we are not entitled to go beyond that finding. The Tribunal made the very pertinent comment that because the assessee had made a gift in favour of his near and dear ones that was a fact which might give rise to the suspicion that it was a purposive gift made with the object of bifurcating the income, but suspicion must not take the place of proof. The Tribunal refused to be overweighed by this suspicion and, therefore, came to the conclusion as it did. In our opinion, the approach made by the Tribunal was a correct approach.

We now turn to the argument of Mr. Pal that the judgment of the Supreme court must be deemed to have concluded the matter in such a manner that we must hold that the gift was a sham gift and the business was a benami business of the assessee himself. In our reading of the judgment of the Supreme Court, this contention of Mr. Pal cannot be upheld. We have herein before set out a long extract from the said judgment. If we analyse the judgment, we find that the Supreme Court firstly overruled the argument of the assessee that the rules of natural justice were violated because no opportunity was given to the assessee to cross-examine Mr. A. L. Majumdar. The Supreme Court found that such an opportunity had in fact been given but was not availed of on behalf on the assessee and, therefore, the criticism that the rules of natural justice were violated had little substance in it. Thereafter, the Supreme Court considered the evidence that had been at that time produced before the Tribunal, and came to the conclusion that on those pieces of evidence the finding by the Tribunal was not perverse and the total effect of the evidence made the transaction suspicious. In the background of that conclusion, their Lordships observed that there existed no such circumstances which merited interference by the Supreme Court in the matter under the provisions of article 136 of the Constitution.

The effect of the judgment of the Supreme Court was that on the materials, then produced before the Tribunal, the finding was justified. Their Lordships did not go to the length of holding that if in future other and better evidence be produced, even then the Tribunal must hold that the transaction of gift was a suspicious or a sham transaction. Wiser by events, the assessee has now produced such evidence as impressed upon the Tribunal. If, on consideration of such evidence, the Tribunal came to the conclusion that the gifts were genuine ones, we are not in a position to set aside that conclusion. We have already noticed that the evidence of A. L. Majumdar was not absent from the consideration. the Tribunal took into consideration that evidence as also other and further evidence produced before them. On a consideration of the totality of the evidence, the Tribunal came to the conclusion that gifts had, in fact, been made by the assessee to his brother and nephew and with the gifted money a separate business under the name and style of Brijlal Nandkishore was started, with which the assessee had no concern. The Tribunal also came to the conclusion that the income of Brijlal Nandkishore should not be tagged to the income of the assessee.

Mr. Pal could not contend that if we are of the opinion that the finding of the Tribunal was not based on partial consideration of evidence even then we should go behind the finding. We have already stated that the finding of the Tribunal does not suffer from the defect of partial consider of evidence.

In the view that we take we are of the opinion that the Tribunal came to the correct conclusion and the question referred to us must be answered in the negative.

We order accordingly.

The assessee is entitled to costs.

MASUD J. - I agree.

Question answered in the negative.


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