Commissioner of Income Tax-I vs Jain Bros. (HUF)

A.M. Sapre, J.—This is an appeal filed by the revenue (income tax Department) u/s 260A of the income tax Act, against the orders, dated 31-8-2004, passed by ITAT in ITA No. 640/Ind/97. The question that arises for consideration in this appeal is, whether appeal involves any substantial question of law out of the impugned order of the Tribunal or in other words, whether two questions proposed by the appellant involves any substantial questions so as to admit the appeal? It is not in dispute that the pre-requisite of admitting any appeal u/s 260A of the income tax Act is to find out involvement of substantial question of law.

Heard Shri R.L. Jain, learned senior counsel with Ku. V. Mandlik, learned counsel for the appellant.

Having heard learned counsel for the appellant and having perused record of the case, we are of the view that appeal does not involve any substantial question of law as is required to be made out u/s 260A of the Act and hence, it merits dismissal in limine resulting in upholding of the impugned order of the Tribunal.

The issue relates to grant of certain deletion which were made by the Assessing Officer in the course of block assessment proceedings initiated against the assessee u/s 158BC of the Act. The Assessing Officer did not accept the explanation offered by assessee and treating the said amount to be that of assessee added in his total income. The CIT(A) as also the Tribunal set aside the order of Assessing Officer insofar as it related to additions made by him (Assessing Officer). In other words, the CIT(A) and Tribunal accepted the factual explanation coupled with the evidence tendered by assessee in relation to the impugned additions made by Assessing Officer and held that since the same have been properly explained and hence, they cannot be included while computing the total income of the assessee. Since, it was a case of raid, and hence, assessee was called upon to explain the source of income so as to enable the Assessing Officer to determine the actual taxable liability arising out of the raid proceedings.

In our opinion, once the CIT(A) and then lastly the Tribunal have accepted the explanation of assessee and accordingly, deleted certain additions made by Assessing Officer then it does not involve any substantial issue of law as such. In other words, this Court in its appellate jurisdiction which is defined u/s 260A ibid, can not again de novo hold yet another inquiry with a view to find out whether explanation offered by assessee and which found acceptance to two appellate authorities namely CIT(A) and Tribunal, is good or bad, or whether it was rightly accepted, or not. It is only when the factual finding is entirely de hors the subject, or that it is based on no reasoning, or that it is absurd to the extent that no reasonable prudent man can ever reach to such conclusion, or that it is against the provision of law, a case for substantial question of law is made out.

In our view, no such error could be noticed by us in the impugned order. The Tribunal did go into the details of explanation offered by assessee and accepted the explanation thereby upholding the view of CIT(A). As a consequence, the certain additions made came to be deleted. We thus, do not find any merit in the appeal. It fails and is dismissed in limine by holding that it does not involve any substantial question of law.

No costs.