Partial partition in a Hindu undivided family cannot be rejected on suspicion when evidence supports the transfer.

A Tribunal's finding on partial partition in a Hindu undivided family is not legally sustainable when it is based on suspicion, conjecture, or disbelief of evidence without stated reasons. The assessee supported partial partition with documents, affidavits, and oral testimony, and the record showed that no books were maintained, the capital transferred to the new firm was identified, and the partners were family members. Because the Tribunal rejected this material mainly on surmise and without proved contrary evidence, its factual conclusion was held perverse and open to interference in law. The answer to the reframed question was therefore in favour of the assessee.

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Issues: Whether the Tribunal's finding that there was no partial partition in the Hindu undivided family, and that the income from the wholesale business continued to belong to the Hindu undivided family after 17 August 1955, was legally sustainable.

Analysis: The assessee supported the claim of partial partition with documentary material, affidavits, and oral statements. The Tribunal rejected that evidence mainly on surmise, including observations about non-production of books, alleged delay in public intimation, supposed ante-dating of a document, disbelief of witnesses without stated reasons, and uncertainty about family capital. The record showed that no books were maintained, the capital taken over by the new firm was identified, the partners were members of the family, and the criticism of the evidence rested largely on suspicion rather than proved contrary material. A factual finding can be interfered with in law when it is unsupported by evidence or is perverse.

Conclusion: The Tribunal's findings were not legally sustainable and the answer to the reframed question was in the negative, in favour of the assessee.

Ratio Decidendi: A factual finding is legally erroneous if it rests on no evidence or on suspicion and conjecture rather than proved material.

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