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TMI Blog2017 (8) TMI 1242X X X X Extracts X X X X X X X X Extracts X X X X ..... ndustries Versus Commissioner of Income Tax, has already interpreted the term "employment for substantial part of the year" to mean the employment not to be for the entire year, but for a substantial period, which, in the facts of case was held to be more than six months in a year. 4. Claiming statutory deduction under the provisions of Clause (iv) of sub-section (2) of Section 80IB of the Income Tax, 1961 (hereinafter referred to as the Act), with respect to the assessment year 2003-04, the present assessee declared his income by filing the return. 5. On scrutiny, such claim of the assessee came to be rejected by the Assessing Officer, in terms of order dated 30.03.2006 (Annexure P-1). 6. It is not in dispute that findings of fact, that of the Assessing Officer qua engagement of less than ten workers, came to be reversed by the Commissioner of Income Tax (Appeals) [hereinafter referred to as CIT (A)], in terms of order dated 24.11.2006 (Annexure P-2). 7. Also finding of fact that of CIT (A) came to be affirmed by the Income Tax Appellate Tribunal (hereinafter referred to as the Tribunal), in terms of order dated 17.11.2008 (Annexure P-3). 8. For proper appreciation, we reprod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not record any other reason for rejecting the contention of the assessee, with regard to employment of requisite number of persons. 14. If the number of persons employed as Foremen are accounted for, assessee would be in compliant of the statutory provisions, entitling him for statutory deductions. 15. The CIT (A), while recording his findings on the question of fact with regard to employment of requisite number of workers, holding the assessee entitled to the benefits under Section 80IB of the Act, returned its findings after ascertaining the factual matrix on the basis of inspection carried out on 21.08.2002, on the premises of the assessee. Now significantly, inspection took place in presence of the Assessing Officer, when entire record was inspected and upon thorough examination of books of account, the factum of employment of foremen, as claimed by the assessee, was found to be factually correct. It is in this backdrop, that the Appellate Authority observed as under:- "3(xii) In the light of the above legal and factual discussions and having regard to the judicial mandates, on the issue in question, it is evident that compliance with the statutory condition of section 80IB( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loyed ten or more workers. We, thus, in light of the above judicial pronouncements and the facts of the case hold that the assessee has satisfied the statutory pre-condition for claiming deduction under section 80IB(2)(iv) of the Act and we hereby confirm the findings of the CIT(A), who on the basis of the relevant record has also found that, the assessee has substantially complied with the statutory pre-condition of employment of workers and, the findings of the AO are not based correct appreciation of the evidence on record and, provisions of law." 18. Careful perusal of the aforesaid findings only reveals the Tribunal to have independently formed an opinion, based on correct, complete and proper appreciation of entire material, that the assessee had in fact employed more than ten workers for substantial part of the year. Findings of fact cannot be said to be arbitrary, illegal, erroneous or unreasonable. 19. As to whether foremen were employed in the process of manufacture or not was not an issue either before the Assessing Officer or before the CIT (A). The only issue being as to whether Foremen were employed in the undertaking or not. It is in this backdrop, the Tribunal fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence of any factual format, a litigant should not be allowed to raise that question as a substantial question of law in second appeal. The mere appreciation of the facts, the documentary evidence or the meaning of entries and the contents of the document cannot be held to be raising a substantial question of law. But where it is found that the first appellate court has assumed jurisdiction which did not vest in it, the same can be adjudicated in the second appeal, treating it as a substantial question of law. Where the first appellate court is shown to have exercised its discretion in a judicial manner, it cannot be termed to be an error either of law or of procedure requiring interference in second appeal. This Court in Reserve Bank of India v. Ramakrishan Govind Morey, AIR (1976) SC 830 held that whether the trial court should not have exercised its jurisdiction differently is not a question of law justifying interference." 25. In Panchugopal Barua v. Umesh Chandra Goswami, (1997) 4 SCC 713, it has been laid down by Hon'ble Apex Court that existence of substantial question of law is sine qua non for the exercise of jurisdiction. The Hon'ble Apex Court has held as under:- "7. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch question has then to be formulated by the High Court. Such questions or question may be the one proposed by the appellant or may be any other question which though not proposed by the appellant yet in the opinion of the High Court arises as involved in the case and is substantial in nature. At the hearing of the appeal, the scope of hearing is circumscribed by the question so formulated by the High Court. The respondent is at liberty to show that the question formulated by the High Court was not involved in the case. In spite of a substantial question of law determining the scope of hearing of second appeal having been formulated by the High Court, its power to hear the appeal on any other substantial question of law, not earlier formulated by it, is not taken away subject to the twin conditions being satisfied: (i) the High Court feels satisfied that the case involves such question, and (ii) the High Court records reasons for its such satisfaction." 27. All the aforesaid judgments have been referred to in the later judgment of K. Raj and Anr. v. Muthamma, (2001) 6 SCC 279. A statement of law has been reiterated regarding the scope and interference of the court in second appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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