COMMISSIONER OF INCOME-TAX Vs. SATYANARYAN AGRAWAL

JUDGEMENT

(1.) THIS appeal preferred by the appellant-Revenue under Section 260A of the Income Tax Act, 1961 (for short "Act"), against the order of the Income Tax Appellate Tribunal, Nagpur (for brevity "the Tribunal") dated March 31,1999, has been admitted for hearing on the following substantial question of law:

(2.) THE facts, as projected in paragraph 2 of the impugned order, are that a survey operation under Section 133A of the Act was conducted at the business premises of the assessee on September 7, 1994, and excess stock of 254.98 quintals of dhaniya valuing at Rs. 1,100 per quintal was found in excess. THE Assessing Officer (for short "AO") treating the said stock as undisclosed investment of the assessee made an addition of Rs. 2,79,400. THE assessee's appeal was allowed by the Commissioner of Income Tax (Appeals) and the addition made was deleted as the difference between the stock found and noted in the books of account on September 5,1994, and the stock found during survey proceedings was sought to be explained by the assessee by producing photo copy of the cash memos received by him from M/s. Harish Kumar Trading Co. and M/s, Ramchandra Shyam Bihari Goyal, however, the above explanation was rejected by the Assessing Officer. THE Commissioner of Income Tax (Appeals) further held that non-acceptance of evidence and on presumption taking the stock as sales outside the books were not justified. It was held that the evidence submitted by the assessee was neither proved by the Assessing Officer to be false or bogus nor genuineness of the transactions was doubted. Further appeal by the Revenue has also been dismissed by the Tribunal.

(3.) ON the other hand, Mr. Dubey, learned Counsel appearing for the assessee would argue that the explanation offered by the assessee and accepted by the appellate forums is a question of fact. The Tribunal is the final court for facts and, therefore, sufficiency of reliability of the explanation offered by the assessee is a question of fact and findings thereon, as recorded by the Tribunal, cannot be interfered with by the High Court as it does not give rise to any substantial question of law. Reliance is place on the judgment of the Rajasthan High Court in the matter of CIT v. Laxmi Engineering Industries reported in : [2009] 308 ITR 279 (Raj) and the judgment of the Madras High Court in the matter of CIT v. N. Swamy : [2000] 241 ITR 363 (Mad).