- (1.) THIS reference under S. 256(1) of the INCOME TAX ACT, 1961, at the instance of the assessee is to decide the following question of law, namely : " Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that income earned in the previous year relevant to the asst. year 1969 -70 by Temani Trading Co. was includible in the hands of the assessee, namely, Prahlad Maliram ?"
(2.) THE relevant assessment year is 1969 -70. The assessee, Prahlad Maliram, Jaipur, is an HUF. The only question relevant in this reference relates to the justification of the Tribunal's conclusion that the income earned during the relevant period by Temani Trading Co. was includible in the hands of the assessee, Prahlad Maliram. The Tribunal has merely followed the conclusion reached on this point against the assessee relating to some earlier assessment years and following that conclusion, the same has been reiterated for the relevant assessment year as well. The Tribunal has stated that the facts and the circumstances of this year are exactly the same as in the earlier years and, therefore, the view taken in respect of the earlier assessment years must be followed. A copy of the order dated January 20, 1987, relating to the same assessee and pertaining to some earlier years of assessment has been shown to us. We find that one of the questions decided by that order is substantially the same as the one to be decided in this reference, namely, the justification for clubbing the income earned by Temani Trading Co. in the hands of the assessee, Prahlad Maliram, treating them as one entity. This question was decided by the Division Bench in the aforesaid order by holding that there was no justification for the conclusion that the business of Temani Trading Co. belonged to the assessee -HUF, Prahlad Maliram, and, consequently, clubbing the income of Temani Trading Co. during the relevant period with that of the assessee was not justified. The view taken by the Tribunal on the same question for the earlier assessment years being the only basis for the conclusion reached by the Tribunal in the present case, the same cannot be sustained after the aforesaid decision of this Court by order dated January 20, 1987 (D.B.I.T. Ref. No. 17 of 1978"Prahlad Maliram vs. CIT (1987) 63 CTR (Raj) 271:(1987) 166 ITR 149 (Raj)) holding that the Tribunal's view on this point pertaining to the earlier assessment years is not justified.
(3.) CONSEQUENTLY , the reference is answered in favour of the assessee by holding that the Tribunal was not Justified in treating the income earned in the previous year relevant to the asst. year 1969 - 70 by Temani Trading Co. as includible in the hands of the assessee, Prahlad Maliram, Jaipur. No costs.;