SAEEDUZZANAN SIDDIQUI, J.-This order will govern the disposal of following Income-tax References :-
(1) I. T. R. No. 272 of 1972,
(2) I. T. R. No. 273 of 1972
(3) I. T. R. No. 274 of 1972,
(4) I. T. R. No. 772 of 1972,
(5) I. T. R. No. 773 of 1972,
(6) I. T. R. No. 774 of 1972,
(7) I. T. R. No. 11 of 1975 and
(8) I. T. R. No. 14 of 1975.
Today only references No. 272 of 1972 to 274 of 1972 and 11, and 14 of 1975 were fixed for hearing but with the consent of Messrs Haider A.I Pirzada and A.I Athar the learned counsel for the parties; we also called for references No. 772 of 1972 to 774/1972 which arc not fixed today, from office as the point involved in all the above-mentioned references is identical and can be conveniently disposed of by one single order. These references relate to the firm of Messrs Hussain Corporation, Gordhandas Market: Karachi for the assessment years 1965-66 to 1972-73. The following two questions have been referred to us under section 66 (1) of the Income-tax Act, 1922 for decision in the above references :- "(1) Whether on the facts and in the circumstances of the case, Messrs Hussain Corporation is a partnership within the meanings of section 4 of the Partnership Act, 1932 ?
(2) Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that a genuine partnership was is existence ?"
2. We have heard Mr. Haider A.I Pirzada and Mr. Nasrullah Await the learned counsel for the Department/applicant and Mr. A.I Athar Advocate, the learned counsel for the respondents.
3. The respondent firm Messrs Hussain Corporation came into existence as a result of a partnership deed executed between the parties whose names are mentioned in the order of the Income-tax Officer. The firm was assessed to Income-tax for the first time in the assessment year [965-66 when it applied for its registration under section 26-A of the income-tax Act. The firm Messrs Hussain Corporation it is admitted, is registered with the Registrar of Firms and the names of persons who claim to be its partners are entered in the Register of Firms. The Income-tax Officer, however, rejected the registration of the aforesaid firm under section 26-A of the Income-tax Act, 1922 or, the ground that the persons who alleged themselves to be the partners of the firm were the wives and- close relations of some of the Directors of Messrs Hussain Textile Mills Limited, who had appointed the respondent firm as its wholesale agent and the main object of forming the respondent's firm was to avoid the incidence of tax. It was also found by the Income-tax Officer that the partnership between the persons named in the partnership deed in fact did not exist as the alleged partners had appointed one Mr. Dawood Yousuf Gabrani as their General-Attorney who in fact managed the affairs of the firm.
4. The Appellate Assistant Commissioner of Income-tax on an appeal filed by the respondent, disagreed with the Income-tax Officer on all the above findings of fact, and held that in law a valid partnership existed between the parties mentioned in the deed of partnership and that mere fact that the affairs of firm were managed by the partners through an attorney was not sufficient to warrant the conclusion that in law no partnership existed between them. On further appeal by the department the order of the Appellate Assistant Commissioner was confirmed by the Income-tax Appellate Tribunal. It has been found both by the Appellate Assistant Commissioner and the Appellate Tribunal as of fact, that the partnership deed executed by the persons named in the order of the Income-tax Officer was a genuine partnership and is lawfully working. We accordingly asked the learned counsel for the department to satisfy us as to how we can interfere under section 66 (1) of the Income-tax Act, with such findings of fact. Messrs Haider A.I Pirzada and Mr. Nasrullah Awan the learned counsel for the department contended before us that the finding arrived at by the Assistant Appellate Commissioner as well as Income-tax Appellate Tribunal in this regard are not in accordance, with the evidence on record and therefore, we can interfere with such a Wing of fact. We are unable to accept the contention of the learned counsel for the department. The evidence in the case has been duly considered both by the Appellate Assistant Commissioner as well as the Income-tax Appellate Tribunal and the conclusions arrived at by them are neither contrary to evidence on record nor based on misreading of evidence and therefore, in our view such findings cannot be disturbed by us while hearing a reference under section 66 (1) of the Income-tax Act. In our view for deciding question of law referred under section 66 (1) of the Income-tax Act, to this Court, the finding of fact arrived at by the Appellate Tribunal has to accepted as binding unless it is shown that the finding was vitiated by misreading of evidence or by perverse appreciation of evidence by the Appellate Tribunal. None of these conditions exists in the present case. The fact that on a reappraisal of evidence, this Court may reach a different conclusion is no ground to interfere with the findings of fact arrived at by the Appellate Tribunal. We may also intention here that in spite of the fact that the Income-tax Officer was of the view that the partnership was notgenuine one but still he assessed the firm as A. O. P.
Under section 10 of they Income-tax Act. After reading the orders of the two authorities below we are convinced that this circumstance alone was sufficient for the reversal of the finding of the Income-tax Officer in the case.
5. We accordingly hold that on the basis of facts found by the Appellate Tribunal, it was justified to hold that Hussain Corporation is a partner--ship firm within the meaning of section 4 of the Partnership Act, 1932. The first question is answered accordingly. In so far the second question is concerned, it relates purely to the factual aspect of the case and no question of law as such arises for our decision. The reference is decided accordingly but we will make no order as to costs.