Harnam Singh, J. - (1.) THIS is an application under Section 66(2) of the Indian Income-tax Act asking this Court to require the Income-tax Appellate Tribunal, hereinafter referred to as the Tribunal, to state the case and to refer for decision to this Court the questions specified hereunder: (1) Whether the order of the Income-tax Officer, Rampur, deciding and declaring that the income from the arhat business in Rampur belonged to Ram Niwas, was final on the question of the liability of that income. (2) Whether the Income-tax authorities in Delhi were competent to go behind the assessment order made by the Income-tax Officer, Rampur, affecting business and income in Rampur State. (3) Whether on the facts and in the circumstances of the case it was not for the Income-tax authorities in Delhi to prove that any income accrued to the assessee during the account year in question from the arhat business at Rampur. (4) Whether the order of the Tribunal is erroneous in law for the reason that the order has not been reached on a consideration of the entire evidence on the record.
(2.) BRIEFLY summarised, the material facts are these. In connection with the assessment for the year 1945-46 Messrs, Ram Parshad Mattan Lal, hereinafter referred to as the assessee, claimed that the arhat business at Rampur, which had hitherto been a business of the joint Hindu family, had been allotted on partition to Ram Niwas and that the profits of the Rampur business could not be assessed in the hands of the assessee. The Income-tax Officer called upon the assessee to substantiate the claim. The joint Hindu family consisted of Ram Kumar and Ram Niwas, sons of Lala Mattan Lal, In making the assessment the Income-lax Officer, Delhi, added the income from the arhat business at Rampur to the income of the assessee. Now, the P. cord of the proceedings before the Appellate, Assistant Commissioner contains a remand report by the Income-tax Officer wherein it is stated that the assesses did not produce some of the account books concerning arhat business at Rampur which were called for and which, according to the Income-tax Officer, were necessary for determining the claim of the assessee. The claim of the assessee rests on the order passed by the Income-tax Officer, Rampur, allowing the assessee's claim to the effect that the Rampur business had been allotted on partition to Ram Niwas, one of the two members of the joint Hindu family. The. Appellate Assistant Commissioner, however, did not consider himself bound by the findings arrived at by the Income-tax Officer, Rampur State. On appeal under Section 33 of the Act, the assessee maintained that the. order passed by the Income-tax Officer, Rampur, was conclusive and binding so far as the Income-tax authorities at Delhi were concerned. In any case, it was said that on the facts and circumstances of the case it was for the Income-tax authorities at Delhi to prove that income accrued to the assessee during the account year from the arhut business at Rampur. The Tribunal repelled the contentions raised and dismissed the appeal. On dismissal of the appeal by the Tribunal, the assessee applied to the Tribunal under Section 66 (1) of the Act for the statement of the case and reference to the High Court for decision of the questions of law raised by the order of the Tribunal. ,The Tribunal has, however, found that the finding that income accrued to the assessee from the Rampur business does not raise a question of law. The Tribunal has then found that the finding that the order passed by the Income-tax Officer, Rampur, is not conclusive and binding on the Income-tax authorities, Delhi, involves a question of law. Considering, however, that the point of law involved in questions Nos. 1 and 2 set out above is settled by authority, the Tribunal has not considered necessary to refer questions Nos. 1 and 2 to the High Court for decision. In these circumstances the assessee applies under Section 60 (2) of the Act for directions to the Tribunal to state the case and refer for decision to this Court the questions set out above.
(3.) MR. Indar Dev Dua, learned Counsel for the assessee,. concedes that there is no rule of law whereunder the order passed by the' Income-tax Officer, Rampur State, can be considered to be binding and conclusive on the Income-tax authorities, Delhi. MR. Dua, however. Urges that on the facia and circumstances of the case it was for the Income-tax authorities, Delhi, to prove that income accrued to the assesses during the account year from the. arhat business at Rampur I do not accede; to the contention raised. Now, the normal state of every Hindu family is joint and in the absence of proof of division, such is the legal presumption. In other words, given a joint Hindu family, the presumption is, until the contrary is proved, that the family continues joint. Admittedly, the arhat business carried on at Rampur was a business of the joint Hindu family and for the first time it was claimed in the 1945-46 assessment proceedings that that business on partition had fallen to the share of Ram Niwas. On those facts, it was for the. assessee to prove that the arhat business at Rampur was no longer the business of the joint : Hindu family. In the proceedings before the Income-tax Officer, the assessee was called upon to substantiate the claim that the arhat business at Rampur was allotted on partition to Ram Niwas. No evidence was examined by the assessee to establish that claim. That being so, the Income-tax authorities were right in holding that the legal presumption that the Hindu family continues joint had not been rebutted. ;