( 1 ) THIS reference, under Section 256 (2) of I. T. Act, 1961, arises out of the assessment proceedings for the assessment year 1969-70, and the question before us is as follows :"whether, on the facts and in the circumstances of the case, the Tribunal's finding that the salaries paid to the managing director and other director were excessive, is perverse ?"

( 2 ) THE assessee is a private limited company carrying on the business of lithographic printing which it took over in the assessment year 1967-68, from Calcutta Art Studio, a firm in which there were several partners.

( 3 ) SHRI P. K. Biswas, Shri S. M. Biswas and Shri Biswajit Biswas were some of the partners of the aforesaid firm and they became the employees of the assessee-company. The AAC in the appeal filed by the assessee-company has allowed the salary paid to them but we are not directly concerned with it in this reference.

( 4 ) THE senior partner of the aforesaid firm was Shri Surendra Nath Biswas. He is a qualified artist and an expert in litho-printing. He became the managing director of the assessee-company on a monthly salary of Rs. 1,500.

( 5 ) SHRI Biswanath Biswas was also a partner of the afores