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TMI Blog1961 (1) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... The judgment of the court was delivered by SHAH J.---These are four appeals with special leave under article 136 of the Constitution. Two of these appeals, Civil Appeals Nos. 652 of 1957 and 654 of 1957 are against the order of the High Court of Judicature at Calcutta declining to call for a statement of the case from the Income-tax Appellate Tribunal, Calcutta, under section 66(2) of the Income-tax Act The remaining two Civil Appeals Nos. 651 of 1957 and 653 of 1957, are against the orders of the Income-tax Appellate Tribunal holding that the four firms, firm " Ladhuram Taparia ", " Jagannath Hanumanbux ", " Jagannath Harnarain " and " Ganpatrai Jorawarmall " belonged to the same group of persons,. viz., Ladhuram Taparia and Ganpatrai Taparia and their respective sons, and that the income earned in the business in cloth and yarn carried on in those names was liable to be amalgamated for purposes of assessment in the hands of the appellant firm and refusing to renew registration of these firms under section 26A of the Income-tax Act. There was originally a firm carrying on business in cloth and yarn in the name and style of " Jagannath Jewanmal " at 37, Armenian Street, C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. Kisenlal Karwa 0 3 0 --------------------------------------------------------------------------------------------------------------------------------------------------- Out of the partners of these firms, Ladhuram and Ganpatrai are full brothers. Sovachand partner of firm No. III is the son of Ganpatrai. Hanumanbux partner of firms Nos. II and IV and Ganeshmal partner of firm No. III are the sons of Ladhuram. Bhairodan Maheshwari partner in firm No. 1, Malchand Baid and Kanayalal Lohia partners in' firm No. IV, Rupnarain Gaggar and Chunilal Lakhotia partners in firm No. V, and Kisenlal Karwa partner in firm No. VI, are strangers to the family of Taparias. Ganpatrai is a partner in firms Nos. I, II, IV, V and VI and in firm No. III Sovachand his son is a partner. Ladhuram is a partner in firms Nos. I, V and VI and in firms Nos. II, III and IV his sons are partners. In assessment proceedings before the assessment year 1945-46, firms Nos. I, II, III and V were registered under section 26A of the Income-tax Act and tax was assessed on that footing. Firms Nos. IV and VI submitted their returns for the first time for assessment of income-tax for the assessment year 1945-46. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the firms, the Income-tax Officer observed that the declarations made by the partners, to the banks " were mostly conflicting with the constitution of the firms declared before " him, that Ladhuram had control over the business carried on by firm No. II though he was not a partner of that firm and that he had in fact authority to operate some of the accounts, that Ganpatrai had declared himself to be partner of firm No. III to the Nath Bank Ltd. even though he was not a partner of that firm, that declarations of the constitution of the firms given before the banks did not in a majority of cases tally, that the employees of some firm declared themselves to be proprietors of other firms, that Ladhuram and his sons Hanumanbux and Ladhuram and Ganeshmal jointly operated some accounts indicating that they were not separate and that Ganeshmal, son of Ladhuram, had operated some of the accounts of firms Nos. I and IV in which he was not a partner. According to the Income-tax Officer it appeared from the declarations given to the banks that " little discrimination " was observed between Ladhuram and his sons in the matter of control of funds of the firms. He, therefore, concluded that all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se amount to any evidence to uphold the inference that the businesses of the 3 firms in question, namely, firms Nos. II, III and IV belong to firm No. I ? 3. Whether in view of the fact that the firms I to IV were all registered under the Indian Partnership Act, 1932, and in view of the provisions of section 68(1) read with section 58(1) of the said Act, it was open to the taxing authorities to question their constitution and to treat them as one concern for the purposes of taxation ? 4. Whether the Appellate Tribunal was right in omitting to consider and record the reasons for its decision rejecting the points urged regarding the several amounts added to the income of the several firms in assessing their taxable income, profits or gains ? 5. Whether while dealing with the questions of quantum of the assessment, it was the duty of the Tribunal to pronounce its opinion on the points regarding the several items of amounts added to the profits of the several firms ? The Tribunal having rejected this application holding that no question of law arose out of their order, the appellants applied to the High Court of Judicature at Calcutta that the Tribunal be called upon to sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner for rejecting the accounts." They also observed : "It was clear that profits had in all these firms to be estimated under the proviso to section 13. About the estimates of profit, the main argument of the assessee's counsel was that as there had been purchases and sales by firms Nos. I, II and III inter se, that fact should be taken into consideration in estimating profits. The Tribunal took into consideration all the submissions of the assessee but came to the conclusion that no case had been made out for the Tribunal's interference with the estimates of profit in the various concerns. In our opinion, the decision of the Tribunal on this point is concluded by findings of fact which are based on ample material on the record and no question of law arises out of this part of the order." Our attention was invited to an item of Rs. 2,39,796, which was added back in assessing the taxable income. Counsel for the. appellants contended that in respect of this item, the Tribunal should have given a considered finding. We do not think that failure by the Tribunal to deal with this item expressly justifies interference by this court. The Income-tax Officer found that " Jagadishpro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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