JUDGMENT R.K. Gulati, J.
1. Through this application under Section 256(2) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), the Commissioner of Income-tax, Meerut, has desired that the Income-tax Appellate Tribunal (D), New Delhi, be directed to refer the following three questions for the opinion of this court :
"1. Whether, on the facts and in the circumstances of the case, the Tribunal had sufficient material evidence to take the affidavits of the three persons on their face value ?
2. Whether, on the facts and in the circumstances of the case, the Tribunal was in possession of sufficient evidence to prove the genuineness of silver from the three persons ?
3. Whether, on the facts and in the circumstances of the case, the Tribunal was legally correct to delete the addition of Rs. 2,06,284 ?"
2. We have heard learned counsel for the parties. It is evident from the frame of questions that the controversy before the Tribunal was whether the addition of Rs. 2,06,284 could be sustained in view of the evidence and the material that were placed before it.
3. The dispute relates to the assessment year 1984-85 with the previous year ending March 31, 1984. The assessee is a partnership concern. During that year, it dealt, inter alia, in manufacture of silver brassing rods in which silver is used. During the course of the assessment proceedings, the Income-tax Officer noticed that having regard to the purchase of silver by the assessee between December 16, 1983, and February 3, 1984, and the goods manufactured, 54.515 kgs. of silver was not accounted for either in the goods manufactured and sold or in the goods in the closing stock. The explanation given by the assessee was not found acceptable. Thus, the Income-tax Officer made an addition of Rs. 2,06,284 to the income of the assessee with the narration "sale of silver not accounted for and purchase price recorded in account and debited to the purchases and trading account". When the matter came in appeal before the Commissioner of Income-tax (Appeals), for the first time, the assessee took the plea that it had temporarily borrowed silver of the quantity in dispute from three persons, earlier in the months of May and July, 1983, which was returned in the month of January and February, 1984. In support of the plea, the assessee also filed affidavits of those three persons, which were entertained by the Commissioner of Income-tax (Appeals) as additional evidence. The Commissioner of Income-tax (Appeals) called for a remand report from the Income-tax Officer who examined the affidavits and also cross-examined the persons filing the affidavits. However, on consideration of the remand report, when the matter came to be heard again by the Commissioner of Income-tax (Appeals), he dismissed the appeal.
4. In the second appeal, the Income-tax Appellate Tribunal reversed the order of the appellate authority and accepted the appeal filed by the assessee, by deleting the entire addition of Rs. 2,06,234. The Tribunal dealt at length with the affidavits referred to earlier and also with the status as well as the family background of these persons who had filed their affidavits. The Tribunal remarked that the assessee had filed an overall tally of silver for the whole year and no discrepancy was found in it except the discrepancy which was the subject-matter of the dispute in appeal. The Tribunal also noticed that detailed affidavits had been filed setting out the family status of their deponents, inheritance made by them of agricultural land, silver, silver ornaments, silver utensils, etc. It also held that although a minor discrepancy remained unexplained, that was not sufficient to reject the affidavits summarily or take them as false statements made with the view to help the assessee. Further, the persons who allegedly loaned the silver to the assessee were men of means and came from respectable families of zamindars and could possess the quantity of silver loaned by each one of them. It is apparent that on appreciation of evidence the Tribunal has chosen to believe the assessee that it had temporarily borrowed silver of the quantity in dispute, which was subsequently returned before the end of the relevant previous year itself.
5. The question whether, on the facts and circumstances of the case, the Tribunal had sufficient material to take the evidence at its face value or whether, on the facts and circumstances of the case, the Tribunal was in possession of sufficient evidence to prove the genuineness of the transaction representing the borrowings of silver, in our opinion, are pure questions of fact. It is settled that if findings of fact are based on some evidence, the sufficiency thereof does not raise a question of law, even if this court were to come to a different conclusion on reappraisal of the evidence and the material that existed on record. The findings of fact may be reviewed if there is no evidence to support them or if they are perverse.
6. The third question, namely, whether the Tribunal was legally correct in deleting the addition of Rs. 2,06,284 is only consequential to the first two questions proposed in the application. The Tribunal having believed the, evidence and material filed by the assessee that was the end of the matter and we cannot say that the conclusion of the Tribunal is perverse or arbitrary in the sense that no person duly instructed in law could have reached such a conclusion. Moreover, no such question has been raised in this application, nor was any such question raised in the application under Section 256(1) before the Income-tax Appellate Tribunal.
7. Consequently, the order of the Income-tax Appellate Tribunal is concluded by the findings of fact and its order does not give rise to any question of law.
8. The application is without any merit and is accordingly rejected with costs which we assess at rupees two hundred.