9911796707
TMI Blog2024 (11) TMI 1325X X X X Extracts X X X X X X X X Extracts X X X X ..... l s fact finding to be perverse, it would have be established that the finding of fact by the Tribunal directly or indirectly affects substantial rights of the assessee in the sense that it is such as could not have been reasonably arrived at on the material placed on record before the Tribunal. In the present factual matrix, it is crystal clear that the Tribunal has examined the facts in great detail, and only thereafter, held in favour of the assessee. - Hon'ble Shekhar B. Saraf And Hon'ble Vipin Chandra Dixit JJ. For the Appellant : Sri Manu Ghildyal, Advocate For the Respondent : Sri Ambleshwar Pandey Sri Ramesh Kumar, Advocates ORDER SHEKHAR B. SARAF, J. 1. Heard learned counsel appearing on behalf of the parties. 2. This is an appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the Act ) wherein the revenue is challenging an order dated June 18, 2024 passed by the Income Tax Appellate Tribunal (hereinafter referred to as Tribunal ), Delhi Benches B , New Delhi in ITA No.821/Del/2022 (Assessment Years 2017- 18). 3. The factual matrix of the present case is that the assessment order was completed by the Assessing Officer under Section 143 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing a notice under section 143(2) as well as notices under section 142(1) of the Act with questionnaire calling upon the assessee not only to furnish the details of cash deposits in the bank account, but also explain the source thereof. The Assessing Officer has also called upon the assessee to explain the reason for low profit compared to the turnover. It is a matter of record that the assessee has responded to each of the queries raised by the Assessing Officer in the questionnaire by explaining the source of cash deposits as well as various other details called for. Not only the Assessing Officer has conducted threadbare inquiry on various issues by issuing number of notices to the assessee, but he has also conducted discreet inquiries from third parties, including the banks, wherein, the assessee has held account by issuing notices under section 133(6) of the Act. The result of such inquiries has been meticulously noted down by the Assessing Officer in the order-sheet maintained in the assessment record. 6. Furthermore, this Court perused the order of the Tribunal with regard to the second substantial question of law. The relevant portion of the decision of the Tribunal is extr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diction of this Court under section 260A of the Act. It is a settled proposition that the Tribunal is the final authority to decide on the issue of facts. The High court can only interfere in the order of Tribunal if there exists a substantial question of law. 9. A Constitution Bench of the Supreme Court headed by Hon'ble B.P. Sinha, the Chief Justice of India in case of Chunilal V. Mehta and Sons Ltd. v. Century Spg. and Mfg. Co. Ltd. reported in 1962 SCC OnLine SC 57 has laid down the following tests to determine whether a substantial question of law is involved or not. The tests are: (a) whether directly or indirectly it affects substantial rights of the parties, or (b) the question is of general public importance, or (c) whether it is an open question in the sense that the issue is not settled by pronouncement of this Court or Privy Council or by the Federal Court, or (d) the issue is not free from difficulty, and (e) it calls for a discussion for alternative view. The relevant paragraph of the aforesaid judgment is extracted below: 6. We are in general agreement with the view taken by the Madras High Court and we think that while the view taken by the Bombay High Court is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d arise unless the finding of fact is perverse. A factual decision is perverse when it is without any evidence or when it cannot be reasonably arrived at by a prudent man. Finding based upon surmises, conjectures or suspicion or when they are not rationally possible, have to be struck down. One may therefore examine the interpretation of perversity by various Courts including the Supreme Court. 12. The Supreme Court in the case of Arulvelu v. State reported in (2009) 10 SCC 206 has defined 'perversity' by following various judgments. The relevant paragraphs of the judgment are extracted below: 24. The expression perverse has been dealt with in a number of cases. In Gaya Din v. Hanuman Prasad ((2001) 1 SCC 501] this Court observed that the expression perverse means that the findings of the subordinate authority are not supported by the evidence brought on record or they are against the law or suffer from the vice of procedural irregularity. 25. In Parry's (Calcutta) Employees' Union v. Parry Co. Ltd. [AIR 1966 Cal 31] the Court observed that perverse finding means a finding which is not only against the weight of evidence but is altogether against the evidence itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gic as to suffer from the vice of irrationality. If a decision is arrived at on the basis of no evidence or thoroughly unreliable evidence and no reasonable person would act upon it, the order would be perverse. But if there is some evidence on record which is acceptable and which could be relied upon, the conclusions would not be treated as perverse and the findings would not be interfered with. (Vide Rajinder Kumar Kindra v. Delhi Admn. [(1984) 4 SCC 635: 1985 SCC (L S) 131: AIR 1984 SC 1805], Kuldeep Singh v. Commr. of Police [(1999) 2 SCC 10: 1999 SCC (L S) 429: AIR 1999 SC 677], Gamini Bala Koteswara Rao v. State of A.P. [(2009) 10 SCC 636: (2010) 1 SCC (Cri) 372: AIR 2010 SC 589] and Babu v. State of Kerala [(2010) 9 SCC 189: (2010) 3 SCC (Cri) 1179].) 14. The Delhi High Court in case of CIT v. Ajay Kapoor reported in 2013 SCC OnLine Del 2779 has further elaborated as to what constitutes perversity . The relevant paragraphs of the judgment are extracted below: 14. Perversity, in the present case, is occasioned due to two reasons: firstly, by wrongly placing onus on the revenue though the facts were in personal knowledge of the assessee, and secondly, by ignoring the admission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... real is on the party who claims it to be so. There should be direct nexus between the conclusions of fact arrived at, or inferred, and the primary facts upon which the conclusion is based. When irrelevant consideration and extraneous materials form the substratum of an order, or the authority has proceeded in a wrong presumption which is erroneous in law, as in the present case, question of law arises and when the said contention is found to be correct, then the order is perverse. A factual decision is perverse when it is without any evidence or when the factual decision, in view of the fact on record, cannot be reasonably entertained. Finding based upon surmises, conjectures or suspicion or when they are not rationally possible have to be struck down. In CIT v. S.P. Jain (1973) 87 ITR 370 (SC) it has been observed that a factual conclusion is regarded as perverse when no person duly instructed or acting judicially could upon the record before him, have reached the conclusion arrived at by the tribunal/authority. 15. In light of the judgments of the Supreme Court and High Courts cited above, we are of the view that unless there is any perversity in finding of facts, no substantial ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
