9911796707
TMI Blog1985 (2) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... ned by the assessee from the Government of Rajasthan. These loans were raised by the assessee for setting up acrylic and cement plants. The claim of the assessee was disallowed by the Income-tax Officer and his order was affirmed in appeal by the Appellate Assistant Commissioner. However, the Tribunal allowed the claim of the assessee relying on a decision of a Division Bench of this court in Prem Spinning and Weaving Mills Company Ltd. v. CIT [1975] 98 ITR 20. A perusal of the judgment in the said case indicates that this judgment was rendered on the basis of the law laid down by the Supreme Court in India Cements Ltd. v. CIT [1966] 60 ITR 52. The question which arose for consideration in the aforesaid two decisions was similar to what has been raised in the instant case as to whether the expenses incurred in respect of obtaining loans were to be treated as capital expenditure or revenue expenditure allowable as a deduction. In the case of Prem Spinning and Weaving Mills Co. Ltd. [1975] 98 ITR 20 (All), it was held that the said amount of expenditure was allowable as a deduction. The same view was taken by the Supreme Court in the case of India Cements Ltd. [1966] 60 ITR 52 also. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made out for requiring the Tribunal to refer these questions to this court for its opinion. Counsel for the assessee strenuously urged that the findings recorded by the Tribunal while reversing the order of the Income-tax Officer and the Appellate Assistant Commissioner and deleting the addition referred to above were essentially findings of fact and no case was made out for requiring the Tribunal to refer these questions to this court. In this connection, it was urged that pleas about sufficiency of evidence, appraisal of evidence or soundness of reasons recorded in support of a finding of fact do not raise questions of law which may be gone into by this court under section 256(2) of the Act. In support of this submission, counsel for the assessee also placed reliance on certain decisions but since the law on the point is well settled and as it has been urged by counsel for the assessee, we do not consider it necessary to refer to those decisions in detail. In our opinion, however, it is not a case where this court is being called upon to go into the question of either sufficiency of evidence or of appraisal of evidence or of soundness of reasons. On the other hand, it is a cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India v. M. L. Capoor, AIR 1974 SC 87, it was held by the Supreme Court (para 28 at p. 98): " Reasons are the links between the materials on which certain conclusions are based and the actual conclusions. They disclose how the mind is applied to the subject-matter for a decision whether it is purely administrative or quasi-judicial. They should reveal a rational nexus between the facts considered and the conclusions reached. Only in this way can opinions or decisions recorded be shown to be manifestly just and reasonable." We find the order of the Tribunal lacking in this behalf. To illustrate, it may be pointed out that apart from the reasons recorded by the Income-tax Officer and the Appellate Assistant Commissioner, reliance was placed by counsel for the Department on certain discrepancies which are referred to in paragraph 23 of the order of the Tribunal. In this connection, certain statements were filed by the assessee before the Tribunal and the Tribunal apparently brushed aside the reasons recorded by the authorities below as also the discrepancies pointed out by counsel for the Department by observing that the discrepancies pointed out by the Revenue had been fully an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for its opinion : " 1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in holding that no defects in accounts have been pointed out by the Revenue which could warrant an addition to the trading results when the Tribunal specifically declined to hold that the accounts of the assessee have been maintained impeachably and there are absolutely no defects which warrant their rejection ? 2. Whether, on the facts and in the circumstances of the case, the finding of the Tribunal that the discrepancies and variations pointed out by the Revenue in stocks, wastage, etc. (some of which have been noted by the Tribunal in para. 23 of its order), are in reality no discrepancies and that the accounts are not defective or unreliable on that account, is justified ? 3. Whether, on the facts and in the circumstances of the case, the finding of the Tribunal that the assessee has clarified and reconciled the variations and discrepancies pointed out by the Revenue in the different figures of stock, wastage, etc., furnished by the assessee at different stages of the case, is based on relevant evidence ? 4. Whether, on the facts and in the circum ..... X X X X Extracts X X X X X X X X Extracts X X X X
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