COMMISSIONER OF INCOME TAX Vs. POPATLAL MULJI

JUDGEMENT

(1.) TWO questions have been referred to us on this reference, one at the instance of the Department which is set out in the concluding part of paragraph 11 of the statement of the case, and the other at the instance of the assessee which is set out in paragraph 12 of the statement of the case. A notice of motion was taken out by the revenue for certain additional questions which we have dismissed today by a separate order. We are, therefore, concerned only with the questions referred to us which are set out in paragraphs 11 and 12 of the statement of the case.

(2.) AS far as the question set out in paragraph 12 of the statement of the case is concerned, the learned counsel have stated that in view of our judgment dated 4th December, 1973, in IT Ref. No. 44 of 1964 [New Kaiser i Hind Spg. and Mfg. Co. Ltd. vs. CIT (1977) 107 ITR 760 (Bom)], the said question must, by consent, be answered in the affirmative and in favour of the Revenue.

(3.) THE findings of fact arrived at by the Tribunal are set out in paragraph 9 of its order dated 9th October, 1964. Those findings, briefly stated, are that since the business of Popatlal Mulji & Co. was initially a proprietary business, the donor must be taken to have consented to the gift of the said sum of Rs. 66,093 to his son, and that the donee who was also a major had accepted that gift by utilising it in the partnership as his capital. The Tribunal has also accepted the statement made before them that the capital that was so credited to the assessee's son in the partnership books was solely operated upon by the assessee's son and not by the assessee himself. The question that has been referred to us in paragraph 11 of the statement of the case must be answered on the basis of these findings of fact arrived at by the Tribunal.