Madhya Pradesh H.C : Whether, on the facts and circumstances of the case, the conclusions arrived at by the Tribunal are not arbitrary, capricious, inconsistent with the evidence and not borne out of the facts on record ?

Counsel Appeared :

Nazir Singh, for the Assessee : D. D. Vyas, for the Revenue.

A. R. TIWARI J.:

The applicant-assessee has filed this application under s. 256(2) of the IT Act, 1961 (for short, “the Act”), seeking a direction to the Tribunal to state a case and refer the questions of law as proposed and extracted below arising out of the order dt. 29th Nov., 1986, passed by the Tribunal in I. T. A. No. 632/(Ind) of 1985 :

“(1) Whether, on the facts and circumstances of the case, the conclusions arrived at by the Tribunal are not arbitrary, capricious, inconsistent with the evidence and not borne out of the facts on record ?

(2) Whether, on the facts and in the circumstances of the case, the Tribunal was right in restoring the addition of Rs. 15,000 made by the ITO and expressing the opinion that the order of the AAC is wholly erroneous and that the applicant is not an agriculturist.

2. Briefly stated, the facts of the case are that the applicant was assessed. She estimated the income from her agricultural activities at Rs. 48,983. The ITO thought that this estimate was very excessive. He, therefore, demanded the particulars. Thereafter, the ITO caused the enquiry through Tahsildar, Jaora. The ITO, then, noticed the applicant to show cause as to why the estimate given by the Tahsildar after enquiry be not accepted. The explanation was that the report did not show the correct position. The ITO eventually added the sum of Rs. 15,000 to the income of the assessee. This addition of Rs. 15,000 was, however, knocked off by the AAC in the appeal filed by the applicant. Aggrieved by the order of the first appellate authority, the non-applicant filed the second appeal which was registered as I. T. A. No. 632/(Ind) of 1985. The appeal was allowed. The order of the first appellate authority was set aside and the order of the ITO was restored. In the result, the addition of Rs. 15,000 was brought back to life. Aggrieved, the applicant filed R. A. No. 17(Ind) of 1987 for reference. That application was rejected on 22nd Nov., 1988. Thereafter, the applicant has filed this miscellaneous civil case.

3. We have heard Shri Nazir Singh, learned counsel for the applicant, and Shri D. D. Vyas, learned counsel for the non- applicant.

4. Counsel for the applicant submitted that the Tribunal did not take into account the relevant material and erroneously dislodged and demolished the finding reached by the first appellate authority. He sub-mitted that in such a situation, the questions are of law and required to be stated and referred. He placed reliance on S. R. Kalani (HUF) vs. CIT (1988) 73 CTR (MP) 160 : (1989) 177 ITR 259 (MP) and CIT vs. K. Sreedharan (1992) 106 CTR (Ker) 12 : (1993) 201 ITR 1010 (Ker).

5. Shri Vyas, on the other hand, submitted that the applicant has already been given benefit of the amount other than the sum of Rs. 15,000. According to him, the order is based on an appreciation of the entire material and the conclusion is one of fact. He, therefore, submitted that there is no referable question of law.

6. We find that the Tribunal held that the alleged buffaloes, trees, etc., were with the assessee’s mother-in-law even earlier. The Tribunal concluded as under :

“This apart, I find that in her capital account, she has shown nominal withdrawals of about Rs. 3,000 to meet her household expenses, whereas she had made an investment of Rs. 62,000 in the firm. This means she is not an agriculturist and all this income was declared by her to justify the investment made by her in the firm, share income from which was nil. She had some income from money-lending business, which was estimated by the ITO at Rs. 2,000, but has been further reduced to Rs. 1,200 by the AAC. All told, it is impossible to believe that she could have net agricultural saving of Rs. 48,983 asdisclosed by her. I would estimate the same at about Rs. 21,000 giving credit for the past saving the maximum at Rs. 31,000. The addition on account of extra investment was only Rs. 15,000 which cannot be said to be excessive by any stretch of imagination.”

7. The Tribunal declined to state the case and held as under :

“The assessee showed net agricultural income of Rs. 48,983 which was not believed by the ITO. He estimated the net agricultural income at Rs. 33,737 and thus made addition of Rs. 15,000 to the income of the assessee as income from other sources. The assessee success-fully appealed before the AAC who deleted the said addition. The Revenue then came in appeal to the Tribunal. The Tribunal reversed the order of the AAC and restored that of the ITO. The finding of the Tribunal is based on appreciation of evidence and, therefore, no referable question of law arises.”

8. We find that all necessary facts and features were taken into account and that the conclusion reached is one of fact. No perversity is visible. The finding of fact does not give rise to any question of law. In CIT vs. Ashoka Marketing Ltd.1976 CTR (SC) 238 : (1976) 103 ITR 543 (SC) and CIT vs. Kotrika Venkataswamy and Sons [1971] 79 ITR 499 (SC), it is held that the finding of fact, not shown to be perverse or perishable, does not give rise to any question of law. The assessee suffering an adverse order at the hands of the Tribunal, persisted in chasing the question. She, therefore, did not give up the pursuit.”Men will do the rational thing”, said Lord Keynes, “but only after exploring all other alternatives.” The assessee filed this application but on appreciation and analysis, we find that the Tribunal was justified in taking the view that it took. We, therefore, find that there is no error in the order passed by the Tribunal. Consequently, we find that there is no referable question of law arising out of the order of the Tribunal. We, therefore, dismiss this application as devoid of merit, but leave the parties to bear their own costs of this application as incurred. Counsel fee for each side, is fixed at Rs. 750, if certified.

[Citation : 221 ITR 674]