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Issues Involved:
1. Whether the partnership constituted by the partnership deed dated October 1, 1958, was genuine. 2. Whether there was material to conclude that the partnership was not genuine. Issue-wise Detailed Analysis: 1. Whether the partnership constituted by the partnership deed dated October 1, 1958, was genuine: The assessee, M/s. Young India Mining and Transport Co., applied for registration under the Partnership Act and was granted a certificate of registration on February 20, 1959. The firm was granted registration under the I.T. Act for the assessment years 1960-61 and 1961-62. However, the ITO, during the assessment proceedings for the year 1962-63, expressed the opinion that no genuine partnership had come into existence on October 1, 1958. The ITO's opinion was based on the reasons recorded in his order under s. 186(1) of the Act for the assessment years 1960-61 and 1961-62. The AAC and the Income-tax Appellate Tribunal both agreed with the ITO's finding and concluded that the partnership was not genuine. 2. Whether there was material to conclude that the partnership was not genuine: The Tribunal considered the statement of Shri Shiv Shankar Aggarwal, the material on record, and the circumstances of the case. The Tribunal noted several inconsistencies and gaps in the knowledge and involvement of Shri Aggarwal in the partnership's business activities. For instance, Shri Aggarwal was unable to provide details about the mining work, the transport business, the weight of iron ore, the names of petty contractors, and the salaries of employees. The Tribunal observed that Shri Aggarwal continued to be an employee of the enterprises of Shri Didwania and had very little time to attend to the affairs of the partnership. The Tribunal found that the address of the alleged firm was the same as that of the Didwania concerns, and no rent was paid for the use of the business premises during the assessment years 1960-61 and 1961-62. The Tribunal concluded that if the firm had been genuinely constituted, Shri Aggarwal and Shri Bhagirath Bhushan would have been actively engaged in the business of the firm. However, the statement of Shri Aggarwal indicated that he was not actively involved in the partnership's business. The Tribunal found that the partnership was a sham and not genuine. The court examined whether the Tribunal had considered the material on record fairly and with due care and attention. The court found that the Tribunal had addressed the relevant question of whether Shri Aggarwal and Shri Bhagirath Bhushan were carrying on the business of the partnership. The Tribunal's finding that the two persons were not carrying on the business was supported by the material on record. The court held that it was not its function to reappraise the entire material or review the evidence to come to a different finding, as it was not acting as a court of appeal. The court distinguished the present case from the cases cited by the counsel for the assessee, noting that the facts and circumstances of those cases were different. The court concluded that there was material before the Tribunal to come to the conclusion that the partnership constituted by the deed dated October 1, 1958, was not genuine. Conclusion: The reference was answered against the assessee, and the court held that there was material before the Tribunal to conclude that the partnership constituted by the partnership deed dated October 1, 1958, was not genuine. The court made no order as to costs.
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