Law: Income Tax Act, 1961

Section: 256,256(2)

Income-tax----Reference---Firm---Registration---Search of five firms and ITO holding that all firms were benamidars of one person---Registration refused ---CIT (Appeals) holding that five firms were genuine ---ITAT confirming CIT's orders---Findings of facts---Conclusion after due consideration of evidence--­Reference application refused---Indian Income Tax Act, 1961, S.256(2). The finding of facts recorded and challenged in a reference jurisdiction can be interfered with, as a question of law, only upon satisfaction of one or more following aspects; that (1) it is perverse; (2) it is based on irrelevant materials; (3) it is unreasonable; (4) it is based on no evidence; (5) it is based on material not on record; (6) it suffers from the vice of non-application of mind to the vital and important materials; (7) the decision or the order is such that no reasonable man can conclude upon the appraisal of the facts on record; (8) there was misapplication of the provisions of law; (9) the authority misdirected itself in law in arriving at the conclusion; (10) there was a complete failure of justice. When the Appellate Authority particularly agrees with the views taken by the authority below he need not meticulously and minutely discuss all the points at the same length as the original authority. Whether a firm registered is a genuine one or not is ordinarily a question of fact and the High Court cannot go behind the facts found by the Tribunal. The finding of fact would be erroneous in law only if it is unsupported by any evidence or it is unreasonable or perverse. There was a search in the premises of five educational institutions as well as residential premises of some of the partners, one of whom was KGD. The Assessing Officer held that all the five institutions were benamidars of the said KGD. Thus, the Assessing Officer was of the view that KGD was the real owner of the five institutions and the said five firms were not genuine. The Assessing Officer, therefore; refused registration under the Income-tax Act. On appeal, the Commissioner of Income-tax (Appeals), after consideration of the relevant materials and the facts and circumstances, reversed the view of the…

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