1970 (4) TMI 8

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....rt by the Tribunal are : (1) Whether section 16(3) of the Act was ultra vires the Central Legislature ? and (2) Whether, on the facts and in the circumstances of the case, the income arising to the three mionor sons of the assessee by virtue of their admission to the benefits of the partnership of Messrs. Ajitmal Kanhaiyalal was rightly included in the total income of the assessee under section 16(3)(a)(iv) of the Act ? The assessee at whose instance those questions were referred did not press for an answer in respect of question No. 1. Therefore, that question was not dealt with by the High Court. Hence, we need not go into that question. The High Court answered the second question in favour of the assessee. The facts necessary for the....

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....e in the firm. The assessee took up the matter in appeal to the Income-tax Appellate Tribunal. The Tribunal upheld the decision of the Appellate Assistant Commissioner. On the facts found by the Tribunal, the High Court came to the conclusion that answer to question No. 2 should be in the negative and in favour of the assessee. The Tribunal found that the capital invested by the minors in the firm came from the gift made in their favour by their father, the assessee. That finding was not open to question before the High Court, nor did the High Court depart from that finding. But, on an interpretation of section 16(3)(a)(iv), the High Court opined that the answer to the question must be in favour of the assessee. Section 16(3)(a)(iv) rea....