Law: Income Tax Act, 1922

Section: 66(1),66,7,12,39(3)(b)

(a) Income-tax Act (XI of 1922)---S. 66(1)--Reference to High Court--Only question of law arising from the order of the Tribunal can be referred--Pure questions of fact cannot be referred by the Tribunal-When a question of fact has been referred by the Tribunal or raised by the party, the Court can refuse to answer such question. Munshi Gulab Singh and Sons v. C.I.T. 1946 I T R 66 ref. (b) Income-tax Act (XI of 1922)-- ---S. 66(1)--Reference to High Court--Court does not interfere with the Tribunal's finding of fact unless it has been specifically challenged, inter alia, on the ground that it was based on no evidence, or on irrelevant evidence, surmises, doubts and conjectures or is perverse--Where on such grounds the finding of fact was challenged, a question of law would arise. Dhirajlal Girdharilal v. C.I.T. (1954) 26 1 T R 736; Dhakeshwari Cotton Mills Ltd. v. C.I.T. (1954) 26 1 T R 775; Sree Menakashi Mills Limited v. C.I.T. (1957) 31 1 T R 28; Oriental Investment Co. Ltd. v. C.I.T. (1957) 32 1 T R 664 (SC) and Kanga and Palkhivalla on The Law of Income-tax, Vol. 1, Fourth Edn., p. 849 ref. (c) Income-tax Act (XI of 1922)-- ---Ss. 66, 7 & 12--Income-tax Rules, 1922, R. 39(3)(b)--Reference to High Court--Where there exists a mixed question of law and fact the inference drawn from facts is one of law and can be raised in reference. In the present case, the Tribunal found that although the assesee was Director of more than one company he was treated as whole-time employee of one of those companies and thus benefits under rule 39 of the Income-tax Rules, 1922 were given to him. By this question the Department sought to agitate that the basis of finding that the assessee was a Director in more than one company the provision of Rule 39 (3)(b) could not be applied. Therefore, it was not purely a question of fact but it was a question where on the basis of fact as found by the Tribunal the legal inference was drawn from applicability of provision of law, which was being challenged. (d) Income-tax Rules, 1922-- --R. 39(3)(b)--Income-tax Act (XI of 1922), Ss. 7 & 12--Assessee a Director of two Companies working whole time in one and. part-time in another and…

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