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TMI Blog1944 (2) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... late Tribunal is extremely unsatisfactory. We had considerable difficulty in finding out the true facts relevant to the question which requires an answer. The only paper which has been printed in the paper book is the statement of the case by the Tribunal. Neither the assessment order nor the appellant order has been printed. Accordingly we adjourned the hearing of the case to enable the learned standing counsel for the Income Tax department to produce these two papers. He has produced extracts from the appellate order and the order of the Income Tax Tribunal by which they refused to give him substantial relief. He was unable to produce the order of assessment. It is desirable that the paper book which is prepared for our use must contain t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e law, for a debate on the meaning of a case stated is an unsatisfactory preclude to a debate on the general law applicable....... It is well settled that when the Commissioners have thus ascertained the facts of the case and then have found the conclusion of fact which the facts prove, their decision is not open to review provided (a) that they have before them evidence from which such a conclusion could properly be drawn and (b) that they did not misdirect themselves in law in any of the forms of legal error which amount to misdirection. Lord Sterndale (Master of the Rolls) in New Zealand Shipping Co. v. Thew, made these observations at page 220 : I wish just to say a word as to what in my opinion is the position of the Commissioners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by stating under the guise of fact that which is really law.... It seems to me the true position is this. The Commissioners are bound to find the facts. In finding the facts they are bound to act upon legal principles and upon evidence which in law can support their finding, and they should state their findings of fact but if they are requested to do so and if it be possible - sometimes it might not be - then I think they should upon the fact of the case state the circumstances upon which they have come to that conclusion, in order that the Court may judge whether in law those circumstances afford any evidence for the conclusion of fact to which the Commissioners have come. That seems to me to be the proper conclusion and it is exactly to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee was entitled to receive a certain sum from Sardar Kartar Singh. It was arranged that Puranmal Dulichand, the new financing partner of Sardar Kartar Singh, would pay over the agreed dues of the assessee. Some payments were made from time to time but as a considerable balance still remained due to the assessee, he had to institute a suit against Puranmal Dulichand to recover the amount remaining due. The assessee claims that he incurred expenses amounting to ₹ 9,606 in the accounting year to recover these dues. The judgment of the Subordinate Judge has not been produced in this case but it is found that the litigation expenses were incurred in the year accounting. The appellate order states that The Income Tax Officer disallowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itled to the deduction of any sum in it. The Appellate Tribunal in their order under Section 33 made these observations :- The business in respect of which this claim arose has been discontinued and the firm has been dissolved. The claim for the money attempted to be recovered has not arisen in the business carried on by the appellant during the previous year. It is foreign to such a business. What was due from the dissolved firm is only capital invested an in attempting to recover it any expenditure incurred is only of a capital nature. Further this is not one of the transactions of the same sort and thus the money spent in releasing this investment cannot be said to have been spent to protect the stock-in-trade of the business carrie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a v. Maharajadhiraja Sir Kameshwar Singh of Darbhanga) applies to the facts of this case. It is argued on behalf of the Commissioner that this expenditure must be taken to be an expenditure attributable to the partnership between the assessee and Sardar Kartar Singh and would be allowable as a deduction only if the partnership came to be assessed. I do not agree with this view because, in the first place, the Income Tax Tribunal has not made any such suggestion and secondly because the assessee himself has been found to have invested this sum in order to earn profits when he agreed to finance Sardar Kartar Singh. Upon the termination of the business connection with Sardar Kartar Singh a certain sum of money fell due to him which was comp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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