1998 P T D 241

[226 I T R 694]

[Supreme Court of India]

Present: J. S. Verma and B. N. Kirpal, JJ

PREM FAMILY (PVT.) (SPECIFIC) TRUST

versus

COMMISSIONER OF INCOME TAX

Civil Appeal No... of 1996 arising out of Special Leave Petition (Civil) x;o.25112 of 1995, decided or; 9th February, 1996.

(Appeal from the judgment and order of the Allahabad High Court, dated August 7, 1995, in Income-tax Application No. 123 of 1994).

Income-tax----

--Reference---Question of law---Trusts---Question regarding genuineness of !rust was a question of fact---No question of law arose out of Tribunal's Order---Order of High Court allowing Revenue's application under 5.256(2) set aside---Indian Income Tax Act, 1961, S. 256(2)---[CIT v. Prem family Private (Specific) Trust (9961 217 ITR 546 reversed].

Where the Tribunal held that the assessee-trust was a genuine one but, however, the High Court allowed the Revenue's application for reference under section 256(2) of the Income Tax Act, 1961, on appeal to the Supreme Court:

Held, allowing the appeal, that no question of law arose out of the Tribunal's order end the only question involved was a pure question of fact regarding the genuineness of the trust. In the facts of the present case, no occasion arose for application of any principle of law at any stage for deciding this question relating to the genuineness of the trust and, therefore, there was no basis to hold that a question of law arose out of the Tribunal's order. The order made by the High Court allowing the Revenue's application under section 256(2) of the Income-tax Act, 1961, had, therefore, to be set aside.

CIT v. Prem Family Private (Specific) Trust (1996) 217 ITR 546 reversed.

K.P. Bhatnagar and S. Rajappa, Advocates for Appellant.

T.L.V. lyer, Senior Advocate (R. Satish and S.N. Terdol, Advocate with him) for Respondent.

JUDGMENT

Leave granted.

We have perused the Tribunal's order. It is clear that no question of law arises out of the Tribunal's order and the only question involved is a pure question of fact regarding the genuineness of the trust. In the facts of the present case, no occasion arose for application of any principle of law at any stage for deciding this question relating to the genuineness of the trust and, therefore, there was no basis to hold that a question of law arises out of the Tribunal's order. The impugned order made by the High Court see (1996) 217 ITR 546) allowing the Revenue's application .under section 256(2) of the Income-tax Act, 1961, has therefore, to be set aside.

Consequently, the appeal is allowed. The impugned order of the High Court (see (1996) 217 ITR 546) is set aside resulting in dismissal of the Revenue's application under section 256(2) of the Income-tax Act. No costs.

M . B. A. / 1471 /FCLeave granted.