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TMI Blog1981 (10) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... 882 ? (ii) If the answer to question No. (i) above is in the negative, whether the value of the properties comprised in the said trust was rightly included in the assessment of the assessee-HUF ? " Pertinent facts leading up to the application : The HUF, consisting of Shri Gangadhar Sikaria the karta, his wife, Sita Devi Sikaria, and his sons, Bhagwati Prasad Sikaria, Santosh Kumar, Ramautar and Ashok Kumar, was the owner of a rice mill named and styled as " Shankar Rice Mills ". The major members of the HUF formed partnership, by the deed executed on 20-0-1959 (sic) in the name and style of Shri Shankar Rice Mills for running the mill business and also a grinding machine-shop under the name and style of " Shri Ganga Industries "Besides the said property, the joint family owned a building at Gauhati as well. Subsequently by a registered deed dated April 19, 1964, the major members of the said joint family settled a trust under the name and style of " Gangadhar Sikaria Family Trust ", ("the trust" for short), for the benefit of Srimathi Sita Devi Sikaria, wife of the karta, Bhagwati Prasad Sikaria, major son of the karta and three minor sons of the karta, namely, (a) Santosh K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... HUF, the present assessee. Those were proceedings under the I.T. Act. In short, the learned Tribunal held that it had earlier decided in the income-tax appeals of the trust that the trust deed was valid, the trust was a legal entity liable to pay tax and the present HUF could not be saddled with the tax liabilities of the trust. The Tribunal also held that the matters were " sub judice " before the Gauhati High Court in pending references. Counsel for the parties admit that such references are pending in various references and the self-same questions as posed in these applications are pending adjudication in Income-tax Reference Case Nos. 3 and 4 of 1978 and No. 10 of 1978. On the dismissal of the appeals, the Revenue prayed to the Tribunal for making references under s. 27(1) of the Act but the Tribunal turned down the prayer by making the following observations: " From the above findings as are found out from the orders of the lower authorities as also that of the Tribunal, it follows that the facts of the 'case' as have been relied upon and annexed to the present reference applications are not found out, hence, are not clear. The questions as have been proposed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax. The appellant contended that the properties were of the assessee whereas the assessee claimed that it belonged to the trust a different legal entity. The learned Tribunal decided that question. It held that the trust was a different entity, having a different status and the trust properties were not includible in, and cannot be treated as, the properties of the assessee-HUF, under the Act. The reasons for arriving at the conclusion are not far to seek. It held that in the I.T. assessment proceedings of the trust, it had the occasion to decide the very question whether the trust was valid or not. If the trust wag non-existent, the authors of the trust should be held as the owners of the properties liable to pay the taxes. The Tribunal held that it had decided on earlier occasions in the IT. proceedings of the trust and/or the assessee, that the trust was valid. It follows, therefore, that it had held earlier On the facts of the case and having had the trust deed before it that the trust was valid. It applied the decisions of the earlier cases in the appeals. Instead of detailed discussions of the facts in the judgment, it dismissed the appeals upon holding that the liabilities o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the cases in hand were the same with those of the prior decision. As such the facts and circumstances of the earlier decision including the facts and law of the precedent got merged in the present appeals. They were engrafted by the Tribunal. Therefore, we have no hesitation in arriving at the conclusion that the learned Tribunal committed an error in assuming that the facts of the case as well as the questions of law cannot be discerned in the present appeals. In our opinion, the facts and circumstances as narrated by the Tribunal, as well as the judgment of the previous cases relied on by it, will be the facts and circumstances of the present appeals as well. The second facet is that the questions of law involved in these appeals were the questions of law in the former appeals. The principles of law of the previous decisions were applied in the appeals surely upon holding that the principles of law were fit to be applicable in the appeals as well. The Revenue claims that in the previous decisions the Tribunal had referred the very same questions of law to this court upon holding that they had arisen out of the decisions. The assessee has not controverted the claim of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether such duties are painful or burdensome. As such, we find that the grounds of refusal to make the present references are thin and non-existent. Now, having disposed of the reasons of the Tribunal as unacceptable grounds, let us turn to consider whether the questions fashioned by the Tribunal are questions of law or not. The questions are prima facie questions of law-they are live questions of law. These questions were referred by the Tribunal as questions of law in its earlier decisions. This is a strong factor to hold that these are questions of law. We are of the view that the questions of law do arise out of the decision of the Tribunal. We have already stated that the Revenue raised the questions for the decision of the Tribunal, but the Tribunal summarily rejected them on the score that it had negatived the contentions earlier. The assessee has not filed any return to the rules stating that the questions of law were never raised by the Revenue in their memorandum of appeal or orally. In our opinion, the Tribunal has impliedly answered the questions in the negative on the authority of its earlier decision wherein it had turned down the contentions. Without a determinat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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