Principal Commissioner Of Income Tax-I v. Shri Omprakash Dhanwani

I. T. A. Nos.140/2016, 141/2016and 142/2016 - 1 - HIGH COURT OF MADHYA PRADESH : BENCH AT INDOREDIVISION BENCH : HON’BLE SHRI JUSTICE S.C. SHARMAHON'BLE SHRI JUSTICE VIVEK RUSIA I. T. A. No.140/2016 Principal Commissioner of Income Tax-I Vs. Shri Omprakash Dhanwani I. T. A. No.141/2016 Principal Commissioner of Income Tax-I Vs. Shri Omprakash Dhanwani I. T. A. No.142/2016 Principal Commissioner of Income Tax-I Vs. Shri Omprakash Dhanwani Ms. Veena Mandlik, learned counsel for the appellant(s). Mr. Sumit Nema, learned Senior Counsel with Mr. Mukesh Agrawal, learned counsel for the respondent(s). O R D E R(Delivered on this 14th of September, 2018) Per : S. C. Sharma, J.: Regard being had to the similitude in the controversy involved in the present cases, the writ petitions were analogously heard and by a common order, they are being disposed of by this Court. Facts of I.T.A.No.140/2016 are narrated hereunder.02-The present appeal has been filed under Section 260-A of the Income Tax Act, 1961 against the consolidated order dated 17/05/2016. 03-The brief facts of the case reveal that the assessee, who is an individual and is engaged in trading of bullion commodity, was subjected to scrutiny assessment and the same was completed under Section 153-A read with Section 143(3) of the Income Tax Act, 1961 on 28/03/2213. The total income was assessed as Rs.27,90,33,030/-. 04-The Assessing Officer has rejected the Books of Accounts of the assessee and additions were made on account of Unaccounted Stock, Unexplained Credit under Section 68, Unaccounted Purchase, Unexplained Credit under Section 68, Estimation of Gross Profit on sale of Gold Bar and Estimation of Gross Profit on sale of Gold Bar again. 05-The assessee being aggrieved by the order passed by the Assessment Officer preferred an appeal before the Commissioner of Income Tax (Appeal) and the appellate authority vide order dated 27/02/2015 has confirmed the addition of Rs.50,00,000/- on account of Unexplained Credit under Section 68 of the Income Tax Act, 1961. 06-The addition on account of estimation of gross profit of Gold and Silver Bar, the Commissioner of Income Tax (Appeal) has confirmed addition and the assessee was ultimately granted a relief of Rs.4,98,05,923/-. The Commissioner of Income Tax (Appeal) has partly affirmed the order passed by the Assessing Officer. Against the order passed by the Commissioner of Income Tax (Appeal), the assessee as well as Income Tax Department preferred appeals before the Income Tax Appellate Tribunal (ITAT) and the ITAT has allowed the appeal of the assessee. 07-The present appeal has been filed under Section 260-A of the Income Tax Act, 1961 and the Income Tax Department has raised certain substantial questions of law. This Court has carefully gone through the order passed by the ITAT and the ITAT has given detailed fact finding in favour of the assessee after scrutinizing the facts, the matter has been decided by the ITAT judiciously and the judgment has been delivered purely on the basis of facts on record. Relevant paragraphs of the order passed by the ITAT, while reducing the demand, reads as under:- 07-The present appeal has been filed under Section 260-A of the Income Tax Act, 1961 and the Income Tax Department has raised certain substantial questions of law. This Court has carefully gone through the order passed by the ITAT and the ITAT has given detailed fact finding in favour of the assessee after scrutinizing the facts, the matter has been decided by the ITAT judiciously and the judgment has been delivered purely on the basis of facts on record. Relevant paragraphs of the order passed by the ITAT, while reducing the demand, reads as under:- “12. As regards application of gross profit rate and enhancement in the turnover, we have gone through the various documents placed before us as also the record of the case. We find that the assessee has disclosed GP rate of 0.53% in the assessment year 2009-10, 0.13% in assessment year 2010-11 and 0.10% in the assessment year 2011-12 on the sales recorded in the books of accounts. The turnover as per books of the assessee for the assessment year 2009-10 was Rs.190.26 crores. The turnover of gold bullion for the assessment year 2010-11 increased to Rs.585.95 crores and for the assessment year 2011-12 it increased to Rs.1035.53 crores. One of the major reasons claimed for the fall in GP rate was the manifold increase in the turnover. The Assessing Officer estimated the profit on 1 enhancement in the turnover, we have gone through the various documents placed before us as also the record of the case. We find that the assessee has disclosed GP rate of 0.53% in the assessment year 2009-10, 0.13% in assessment year 2010-11 and 0.10% in the assessment year 2011-12 on the sales recorded in the books of accounts. The turnover as per books of the assessee for the assessment year 2009-10 was Rs.190.26 crores. The turnover of gold bullion for the assessment year 2010-11 increased to Rs.585.95 crores and for the assessment year 2011-12 it increased to Rs.1035.53 crores. One of the major reasons claimed for the fall in GP rate was the manifold increase in the turnover. The Assessing Officer estimated the profit on 1 kg. of gold in the range of Rs. 4000/- to Rs. 6000/- per 100 gm and GP on sales of silver was in the range of Rs.1200/- to Rs. 2500/- on 1 kg. The CIT(A) estimated the GP at 1.25% and also enhanced the total turnover by 17.5% for these years and made the addition. 13. We further find that the CIT(Appeals) vide para-14 of the order concluded that method of estimation of profit adopted by AO was defective and faulty hence such estimation of income was rejected for all the years in relation to gross profit on sales of gold bullion. Similar defects were also there in estimation of profit by AO on sale of silver bars hence that estimation was also rejected. However, the learned CIT(A) grouped the sales of gold bullion and silver bullion together at Rs. 10,35,53,58,633/- (i.e. gold bullion Rs.10,30,03,690/- and silver bullion Rs.5,50,01,943/-) for A.Y. 2011-12. Similarly, the learned CIT(A) grouped the sales of gold bullion and silver bullion together at Rs. 585,95,67,563/- (i.e. gold bullion Rs.584,67,73,769/- and silver bullion Rs.1,27,93,794/-) for A.Y. 2010-11 and by making enhancement of 17.5% on aggregate sales, the learned CIT(A) applied gross profit rate of 1.25%. 14. We further find that the additions in silver bullion account were made by the Assessing Officer at Rs.9,65,123/- and Rs.40,69,563/- in A.Y. 2010-11 & 2011-12 by estimating gross profit on sale of silver bullion. It was also contended by the learned counsel for the assessee before us that no incriminating documents regarding purchase/sale of silver bullion were found. Gross profit on sales of silver bullion was disclosed @ 0.63% in A.Y. 2010-11 and @ 1.06% in A.Y. 2011-12. Quantitative records have been maintained and books of accounts are audited. Sale of silver bars during and in A.Y. 2010-11 was Rs.1,27,93,794/- (522.946 kg) whereas sale in A.Y. 2011-12 was Rs.5,50,01,943/- (1861.524 kg.). The Assessing Officer did not apply gross profit rate but he conducted market enquiry of silver bullion trade business. The Assessing Officer on the basis of market enquiry found that profit on one kg silver bar was in the range of Rs.1200/- to Rs.2500/- per kg. He, therefore, estimated the gross profit @ Rs.2,000/- per kg. in A.Y. 2010-11 and @ Rs.2,500/- per kg. on sales of 522.946 kg in A.Y. 2010-11 & on 1861.524 kg in A.Y. 2011-12 on sales of silver bar. 15. We also find that the assessee is dealing in precious metal like gold and silver and the rates are verifiable and available in open to every customer from MCX gold reports or Sarafa Publications. Thus, the customers who purchase goods from the assessee were well aware about the prevailing market price of these metals at the relevant time. Most of the purchases are from reputed dealers. Very few documents pertaining to the assessment year 2011-12 were seized which suggest that the assessee indulged in trading which was not recorded in the 15. We also find that the assessee is dealing in precious metal like gold and silver and the rates are verifiable and available in open to every customer from MCX gold reports or Sarafa Publications. Thus, the customers who purchase goods from the assessee were well aware about the prevailing market price of these metals at the relevant time. Most of the purchases are from reputed dealers. Very few documents pertaining to the assessment year 2011-12 were seized which suggest that the assessee indulged in trading which was not recorded in the books of accounts. For recorded purchases, the assessee was maintaining day to day stock register with quantities and purchase vouchers. The payments were also made through banking channels. Therefore, the learned CIT(A)’s action in enhancing the turnover by 17.5% for all the years is unjustified. There was seizure of documents which suggest unaccounted sales for the assessment year 2011-12 and with a view to plug the loopholes, we are of the view that the enhancement in turnover by 5% on the sales recorded in the books of accounts shall be reasonable for the assessment year 2011-12. We accordingly direct the Assessing Officer to enhance the turnover by 5%. Further, on account of sharp fall in GP rate as disclosed by the assessee as compared to assessment year 2009-10, we also find it appropriate to enhance the turnover by 5% for the assessment year 2010-11. We direct accordingly. Since we are accepting the GP rate declared for the assessment year 2009-10 in the absence of any incriminating documents for the relevant period and better book results in comparison to succeeding years and no defect in books of accounts was found by the authorities below for assessment year 2009-10, therefore, we direct to accept the book results for the assessment year 2009-10. The gold prices were also increased during the relevant period. The average gold price for the period relevant to the assessment year 2007- 08 was Rs.8.36 lacs per kg. which increased to Rs. 16.32lacs per kg for the period relevant to the assessment year 2010-11 and Rs. 20,72,000/- for the period relevant to assessment year 2011-12. We also observe that whenever there is tremendous increase in the price of gold, the margin of profit shrinks. Gold market is well informed marked and guided by international price. There was VAT of 1% on the recorded trading of gold. Thus, the gross profit estimated on unrecorded sales cannot be applied to the recorded sales as the margin of tax also remains with the seller of unaccounted sales while in the recorded sales the prices are increased by VAT which reduces the margin of profit by the similar amount. The cumulative effect of increase in turnover and increase in gold price must have reduced the gross profit for the assessment years 2010-11 and 2011-12. We also find that the Additional Commissioner of the same Range in the case of Shri Nitesh Kumar Doshi for the A.Y. 2010-11 has accepted the G.P. rate at 0.14% on the recorded sales and Shri Doshi was also engaged in similar business. In the case of Baldev Krishna the GP was estimated at Rs. 400/- per 120 gms which comes to around 0.2% of the sales recorded. Similarly in the case of Vonamala Jagdishwaraiah; (2015) 44 CCH 005 GP at 0.1% has been accepted by Hyderabad Bench of ITAT and in the case of Mahendra Kumar Agrawal (2015) Tax Publication (DT) 2124 the Jaipur Bench of the Tribunal accepted the GP of 0.1%. Further, we are of the view that on unrecorded sales estimated, the profit has to be worked out at the rate of 1.25%. Considering all these aspects we sustain the gross profit rate of 1.25% on the enhanced turnover of gold bullion for the assessment years 2010-11 and 2011-12 and on the recorded turnover disclosed in the books of accounts, we direct to apply gross profit rate of 0.25%. has to be worked out at the rate of 1.25%. Considering all these aspects we sustain the gross profit rate of 1.25% on the enhanced turnover of gold bullion for the assessment years 2010-11 and 2011-12 and on the recorded turnover disclosed in the books of accounts, we direct to apply gross profit rate of 0.25%. 16. We also hold that the CIT(A) was not justified in considering the combined sales of gold and silver bullion because there was not a single incriminating document or any evidence found on the basis of which the Assessing Officer could reject the book results of purchase/sale of silver bullion. No addition can be made on estimations and on hypothetical grounds with regard to sale of silver bullion. We are also of the view that not only the enhancement made by the CIT(A) in silver bullion account by 17.5% but the application of GP rate of 1.25% applied by the learned CIT(A) is not justified. We, therefore, delete the additions made in silver bullion account for the assessment years 2010-11 and 2011-12.” 08-The appellant before this Court has stated that the following substantial question of law arises in the present appeal:- “Whether on the facts and in the circumstances of the case and in law, the ITAT was justified in deleting the addition of Rs.2,02,47,590/- by not providing the basis or contrary finding to the reasons given in assessment order as well as in order of Ltd. CIT(A), due to which addition was deleted ?” The aforesaid so called question framed by the Department is purely a question of fact and the ITAT has given a detailed finding in favour of the assessee after scrutinizing the facts and no substantial question of law is involved. The findings arrived at by the Income Tax Tribunal are after considering the facts on record. The Tribunal endorsed the following reasoning, as reproduced below, while deleting the addition of Rs.2,02,47,590/- on account of unaccounted investment in Assessment Year 2009-10. and 142/2016 - 7 - Relevant paragraphs i.e. paragraphs No.17 to 21 of the order passed by the ITAT reads as under:- “17. Ground no. 5 in IT(SS) A No. 241/Ind/2015 (assessee’s appeal) and ground no. 6 in IT(SS) A No. 254/Ind/2015 (revenue’s appeal) is regarding the addition sustained of Rs. 2,02,47,590/ - on account of unaccounted investment in A.Y. 2009-10. 18. The facts, in brief, are that on 26.1.2010 the police intercepted two persons with 30 silver bars weighing 919.276 kgs valued at Rs.2,02,47,590/-. They were transferring the bullion from the residence of the assessee at Gumasta Nagar to his office at Chhota Sarafa, Indore. The police seized the silver which was requisitioned by DDIT (Inv.) by invoking provisions of section 152A of the Act. The assessee claimed that these silver bars were purchased on 25.8.2008 by the assessee at Ahmedabad from Riddhi Siddhi Jewellers 609.456 kgs and M/s M.D. Overseas 309.211 kgs and then transported from branch office at Ahmedabad to Indore office by Rajesh Driver of the assessee who carried the same by Vehicle No. MP 41, D-0175. The original bills were handed over to the police. The Assessing Officer did not believe the assessee’s explanation and made the addition. The learned CIT(A) also relied upon the findings of the Assessing Officer and noted that there are substantial evidences and many holes in the story of the assessee regarding purchase of silver and he accordingly upheld the addition. However, the learned CIT(A) allowed the benefit of telescoping of income added in the earlier years by estimating the gross profit. Now the assessee as also the revenue are in appeal before the Tribunal. 19. Before us, while pleading on behalf of the assessee, the learned counsel for the assessee submitted that for the purchase of this silver, the assessee has made advance payment through RTGs and the sellers have confirmed the transactions. The bills were produced. Even the bills of exchange, which were obtained by the seller on the import of goods, were also produced. He also pleaded that the bar numbers on the seized silver and the bar numbers in the purchase bill were tallying. These silver bars were purchased from Riddhi Siddhi Bullion which is assessed to tax which has declared income for more than Rs.5 crores. As such it is a reputed firm and, therefore, not believing the bills issued by Riddhi Siddhi Bullion is highly unjustified. He, therefore, prayed to delete the addition. 20. On the other hand, the learned DR submitted that no proof of transport of silver from Ahmedabad to Indore has been filed and, therefore, the transaction is unexplained. He, and 142/2016 therefore, pleaded that the authorities below were justified in making the addition. 21. After hearing both the sides, we are of the view that the assessee has made payment in advance through RTGs and submitted a bill issued by Riddhi Siddhi Bullion. The seller has also confirmed the transaction. The copy of bill of exchange obtained from the seller on account of import of goods was also produced. Since it was an imported material and the bar numbers were inscribed on the seized bars which tallied with the purchase bills, we find no merit in sustaining such addition. We, therefore, direct to delete the same.” 09-The another question i.e. question No.5 raised by the appellant / Income Tax Department reads as under:- “Whether on the facts and in the circumstances of the case and in law the ITAT was justified in deleting the addition of Rs.17,85,88,277/- by not providing the basis or contrary finding to the reasons given in assessment order as well as in order of Ld. CIT(A), due to which addition was deleted ?” The respondent assessee submits that the aforesaid question is also a question of fact and ITAT has given a detailed fact finding in favour of the assessee after scrutinizing the facts and as such no substantial question of law is involved in this case. The findings arrived at by the Income Tax Tribunal are after considering the facts on record. The Tribunal endorsed the following reasoning in respect of the aforesaid question, as reproduced below, while deleting the addition of Rs.17,85,88,277/- on account of purchase made from M/s. Hyundai Exporters. Paragraphs No.23 to 28 of the ITAT's order reads as under:- “23. During the financial year 2008-09 relevant to A.Y. 2009-10 the assessee has shown purchases from M/s Hyundai Exports of Rs.17,85,88,277/-. As per the Assessing Officer, the assessee could produce the original bills to the tune of Rs.12,56,94,400/- and the remaining bills were not produced. The Assessing Officer observed that bill/tax invoice does not bear the official seal of the seller. In place of seller, the space was found blank. The bill issued on 17.9.2008 was not found to have been signed by the seller and the order number, date of order, delivery memo, etc. were found blank. He observed that the bills produced cannot be relied upon and accordingly addition was made. 24. Against the addition so made by the Assessing Officer, the assessee preferred appeal before the learned CIT(A) who observed as under :- assessee could produce the original bills to the tune of Rs.12,56,94,400/- and the remaining bills were not produced. The Assessing Officer observed that bill/tax invoice does not bear the official seal of the seller. In place of seller, the space was found blank. The bill issued on 17.9.2008 was not found to have been signed by the seller and the order number, date of order, delivery memo, etc. were found blank. He observed that the bills produced cannot be relied upon and accordingly addition was made. 24. Against the addition so made by the Assessing Officer, the assessee preferred appeal before the learned CIT(A) who observed as under :- “18.2 As is evident entire purchase account of purchases of Rs.17,85,88,277/- from M/s Hundai Export was manipulated one. However having arrived at conclusion of questionable purchase from one party, it does not lead to such conclusion automatically that entire of such amount is to be added in hands of appellant, unless it can be established that such purchases were not for business of appellant, but for his personal consumption. Certainly such purchase was not for personal consumption, which indicates purchase of such gold from grey market being introduced in books through such questionable purchase bills, as and when stock was sold and confirms the view taken by undersigned that both sales & profit were suppressed. Such questionable purchase bills lead us to same conclusion of enhancement of sales & application of higher GP rate. Since in this year sales have already been enhanced from Rs.190.26 crore to Rs.223.96 crore and GP is enhanced from Rs.1.01 crore to Rs.2.79 crore i.e. by Rs.1,77,80,700, that duly takes care of such questionable purchases. Hence while such purchases of Rs.17,85,88,277/- are held as unexplained, their separate addition made by AO is hereby deleted, as on that basis as well as for other reasons, GP addition is already made. In this sense, Gr. no.10 of appeal is partly allowed.” 25. Against the above findings of the learned CIT(A), the assessee as well as the revenue are in appeal before us. 26. The learned counsel for the assessee submitted that the Assessing Officer made the addition of Rs.17,85,88,277/- in a small paragraph with a remark that the assessee has shown purchases of gold and silver from Hyundai Exports since the assessee could produce the original bill to the tune of Rs. 12,56,94,400/- only and remaining bills could not be produced. He further submitted that the Assessing Officer observed that on some of the bills official seal of the seller was not affixed, receiver of the bill has also not signed, the date of order and column of order number and delivery memo are found blank and various bills were signed by different persons. He submitted that 10- confirmed ledger copy of account was filed from the firm Hyundai Exports. They have confirmed the purchases made by the assessee. For all these purchases, the assessee has made advance payments through banking channels, which is evident from page 168 of the paper book and copies of all the bank statements were filed during the assessment proceedings and all the entries in connection with the payment for these purchases were recorded in the books of accounts. He also pleaded that before the learned CIT(A) all the bills including the bills which could not be filed before the Assessing Officer, were filed, which were verified by him. The learned CIT(A) observed that the assessee has entered in the stock register different purchases. He further submitted that the confirmation from the seller has been filed, bills were produced, purchases are entered in the regular books of accounts and also in the stock register, payments for all these purchases were made through banking channels, all these payments are verified from books of accounts and bank statements. He, therefore, pleaded that such additions are unjustified. 27. On the other hand, the learned DR relied upon the assessment order. 28. We have heard both the sides. We find that the assessee has filed confirmation from the seller, the original bills were produced, the purchases are entered in the regular books of accounts and stock register. The payments for these purchases were made through banking channels that too in advance, which are verifiable from the books of accounts as well as from the bank statements. The assessee has submitted necessary documents and evidence in the paper book. Keeping all these facts in view, we find no merit in sustaining the addition. Hence, we delete the same.” Thus, it is evident that the question No.5 is a pure question of law and cannot be entertain under Section 260-A of the Act of 1961 as the issue of genuineness of purchase does not raise a substantial question of law. The questions raised by the appellant are actually questions of fact, which are merely dressed up as being questions of law, in order to get the instant appeal entertained. It is further reiterated that it is a well settled principle that for an appeal to be raised and admitted under Section 260-A of the Act, the questions raised must involve a substantial question of law and not a question of fact, which has not been answered or, on which, there is a conflict of decisions necessitating a resolution and in the present appeal the question No.5 is a pure question of fact. 11-Learned counsel for the respondent has placed reliance upon a judgment delivered in the case of Malpani House of Stones Vs. Commissioner of Income Tax reported in (2004) 186 CTR 467 (Rajasthan) and his contention is that in the aforesaid case the Court has held that admittedly, the provision to Section 145 of the Income Tax Act, 1961 is attracted. On the facts and material produced before the Assessing Officer, the additions are made on account of sales, purchases and brokerages. Whether the sales, purchases and brokerages were genuine or not is basically a question of fact and this Court is of the opinion that the finding on fact is not perverse. 12-Question No.6 raised by the appellant / Income Tax Department reads as under:- “Whether, on the facts and in the circumstances of the case and in law the ITAT was justified in deleting the addition of Rs.50,00,000/- by not providing the basis or contrary finding to the reasons given in assessment order, as well as in order of Ld. CIT(A), due to which addition was deleted ?” The aforesaid question No.6 is also a question of fact and the ITAT has given detailed finding in favour of the assessee after - 12 - scrutinizing the facts and as such no substantial question of law is involved in this case. The findings arrived at by the Income Tax Tribunal in respect of the aforesaid question in paragraphs No.29 to 32 reads as under:- “29. Ground no. 7 in IT(SS) A No. 241/Ind/2015 is regarding sustenance of addition of Rs. 50 lacs made u/s 68 of the Act which was received from M/s Pramila Investors & Finance Limited. The Assessing Officer made the addition of Rs.50 lacs being sundry credit balance in the name of M/s Pramila Investors & Finance Limited by holding that identity, income tax return and bank statement of the party have not been filed. This action of the Assessing Officer was sustained by the learned CIT(A). Now the assessee is in appeal before the Tribunal. 30. The learned counsel for the assessee submitted that the assessee has filed confirmation with PAN along with income tax return of M/s Pramila Investment & Finance Ltd. This transaction was through banking channels. He submitted that this amount was not received as loan but it was received for future trading MCX business and this amount was received as advance/margin money for trading in MCX. The learned counsel for the assessee has submitted the following documents before us :- 30. The learned counsel for the assessee submitted that the assessee has filed confirmation with PAN along with income tax return of M/s Pramila Investment & Finance Ltd. This transaction was through banking channels. He submitted that this amount was not received as loan but it was received for future trading MCX business and this amount was received as advance/margin money for trading in MCX. The learned counsel for the assessee has submitted the following documents before us :- i)Confirmation certificate along with PAN of the creditor M/s. Pramila Investment & Finance Ltd, ii)Copy of acknowledgment of return of income filed by M/s. Pramila Investment & Finance Ltd. The learned counsel for the assessee submitted that from the copy of bank statement of M/s Pramila Investment & Finance Ltd. for the period from 01.02.2009 to 31.03.2009 it is clear that this amount of Rs. 25 lacs each was transferred to the assessee through MICR on 28.02.2009 and 07.03.2009 and there was no cash deposit in this bank account. He also submitted that the assessee himself requested the Assessing Officer to issue summons u/s 131 of the Act for calling the information u/s 133(6) of the Act directly from the party. The Assessing Officer thereafter issued letter to the above party on 18.3.2013 asking for compliance by 30.3.2013. The learned counsel for the assessee submitted that since the period given by the Assessing Officer to the above party was very short within which it was not possible for the above party to appear, the Assessing Officer was not justified in making the addition only on the ground of non- and 142/2016 - 13 - ompliance with notice u/s 131 of the Act. The learned counsel for the assessee, therefore, submitted that the learned CIT(A) without considering these facts, simply rejected the assessee’s contention and sustained the addition. 31. On the other hand, the learned DR supported the orders of the authorities below with the submission that the assessee failed to prove its case before the learned CIT(A) and as such he was fully justified in maintaining the addition made by the Assessing Officer. 32. We have heard both the sides. We find from the bank statement of M/s Pramila Investment & Finance Limited that there was bank balance of Rs.32.5 lacs on the last date of the financial year i.e. on 31.3.2009. The interest was paid after deducting TDS. These facts are sufficient to establish that the assessee was able to be discharge the obligation casted upon him u/s 68 of the Act by establishing the identity, creditworthiness and genuineness of the transaction. In this view of the matter, we have no alternate but to delete the addition. Accordingly we direct the Assessing Officer to delete the addition. This ground of the assessee is, therefore, allowed.” 13-Thus, it is evident that the the aforesaid question is purely a question of fact. The respondent assessee has further submitted that the question No.6 raised in this appeal is not question of law but it is a pure question of facts which have been decided by the Tribunal as a last authority on facts by analyzing the relevant documents placed before it by the appellant. 14-Not only this, in the case of Commissioner of Income Tax Vs. Pithampur Conzima (P) Ltd. reported in ITR 244 442 (MP), the coordinate Bench of this Court has held that it become clear that the Tribunal has accepted the explanation of the assessee which showed that the credit given was duly declared by the creditors in the new return and therefore, deletion of the addition was on the basic on the satisfaction reached by the Tribunal and on the appreciation of material before it and therefore, the matter accordingly does not give rise to any question of law warranting dismissal of this application which is accordingly dismissed. 14-Not only this, in the case of Commissioner of Income Tax Vs. Pithampur Conzima (P) Ltd. reported in ITR 244 442 (MP), the coordinate Bench of this Court has held that it become clear that the Tribunal has accepted the explanation of the assessee which showed that the credit given was duly declared by the creditors in the new return and therefore, deletion of the addition was on the basic on the satisfaction reached by the Tribunal and on the appreciation of material before it and therefore, the matter accordingly does not give rise to any question of law warranting dismissal of this application which is accordingly dismissed. 15-Learned counsel for the respondent has placed reliance upon another judgment delivered by this Court in the case of Commissioner of Income Tax Vs. Barjatiya Children Trust reported in (1997) 225 ITR 640, wherein coordinate Bench of this Court has held that the finding about the genuineness is a finding of fact based on proper appreciation of facts and does not manifest any illegality or perversity. 16-The respondent has further placed reliance upon a judgment delivered by the apex Court in the case of Commissioner of Income Tax Vs. Orissa Corpn. (P) Ltd. reported in (1986) 25 Taxman 80F (SC). The apex Court in the aforesaid case has held that the assessee had given the names and addresses of the alleged creditors. It was in the knowledge of the revenue that the said creditors were the income tax assessees. Their index number was in the file of the revenue. The revenue, apart from issuing notices under Section 131 at the instance of the assessee, did not pursue the matter further. The revenue did not examine the source of income of the said alleged creditors to find out whether they were creditworthy or were such who could advance the alleged loans. There was no effort made to pursue the so called alleged creditors. In those circumstances, the assessee could not do anything further. In the aforesaid premises, if the Tribunal came to the conclusion that the assessee has discharged the burden that lay on him then it could not be said that such a conclusion was unreasonable or perverse or based on no evidence. If the conclusion is based on some evidence on which a conclusion could be arrived at, no question of law as such arises. 17-Appellant Income Tax Department has raised another question i.e. question No.7 and the same reads as under:- “Whether, on the facts and in the circumstances of the case and in law, the ITAT was justified in law in upholding the deletion of the addition of Rs.45,00,000/- by Ld. CIT (A) by not providing the basis or contrary finding to the reasons given in assessment order, due to which addition was deleted ?” The aforesaid question No.7 is again a purely in the realm of facts and both the first appellate authority as well as the second appellate authority have given concurrent findings in favour of the assessee respondent after scrutinizing the facts and as such no substantial question of law is involved in this case. The findings arrived at by the first appellate authority i.e. the CIT (A) reads as under:- “17. Gr. no. 9 of appeal is against addition of Rs.45 lakh u/s 68 of the I.T. Act on the ground of repayment of amount from M/s MP real Estate. The said sum of Rs.45 lakh was invested by u/s 68 of the I.T. Act on the ground of repayment of amount from M/s MP real Estate. The said sum of Rs.45 lakh was invested by and 142/2016 18- appellant in that firm M/s MP Real Estate & Developers, in earlier years and in this year, such amount of partner’s contribution was merely returned back by that firm & hence it cannot be added as cash credit u/s 68 of I.T., as it is merely refund of partner’s contribution repaid through cheques. Hence addition of Rs.45 lakh is hereby deleted. Gr. no.9 of appeal is allowed.” The Tribunal has also upheld the findings of the CIT (A) and has held as under:- and 142/2016 18- appellant in that firm M/s MP Real Estate & Developers, in earlier years and in this year, such amount of partner’s contribution was merely returned back by that firm & hence it cannot be added as cash credit u/s 68 of I.T., as it is merely refund of partner’s contribution repaid through cheques. Hence addition of Rs.45 lakh is hereby deleted. Gr. no.9 of appeal is allowed.” The Tribunal has also upheld the findings of the CIT (A) and has held as under:- “36. After hearing the parties, we find that the learned CIT(A) has deleted the addition by holding that the amount of Rs. 45 lacs was invested by the assessee in the firm, M.P. Real Estate & Developers in earlier years and in this year this amount was received as partners’ contribution by that firm. Hence, the addition u/s 68 could not be sustained and it was merely refund of partners’ contribution repaid through cheque. The learned DR failed to controvert the findings of the learned CIT(A). We, therefore, after hearing both the parties, sustain the order of the learned CIT(A). Hence, this ground of the revenue stands dismissed.” 19-Thus, it is evident that the question No.7 raised in this appeal is not a question of law but it is a pure question of facts which have been decided by the Tribunal as a last authority on facts by analyzing the relevant documents and facts and the first appellate authority has also decided the issue in favour of the assessee and there are concurrent findings of fact arrived at by both the appellate authorities. 20-Learned counsel for the respondent assessee has argued before this Court that the question raised by the appellant Department do not contain any merit and are therefore, not sustainable in law. He further submits that the present appeal has been filed for the sake of lingering on with the case, whose facts have finally been settled and examined by the ITAT, which by law upheld by the apex Court, is the final fact finding authority. 21-The Hon'ble Supreme Court in the case of Santosh Hazari Vs. Purushottam Tiwari reported in (2001) 3 SCC 179, wherein the apex Court has held as under:- 22- “A point of law which admits of no two opinions may be a proposition of law but cannot be a substantial question of law. To be substantial, a question of law must be debatable, not previously settled by law of the land or a binding precedent, and must have a material bearing on the decision of the case, if answered either way, in so far as the rights of the parties before it are concerned. To be a question of law involving in the case there must be first a foundation for it laid in the pleadings and the question should emerge from the sustainable findings of fact arrived at by court of facts and it must be necessary to decide that question of law for a just and proper decision of the case. An entirely new point raised for the first time before the High Court is not a question involved in the case unless it goes to the root of the matter. It will, therefore, depend on the facts and circumstance of each case whether a question of law is a substantial one and involved in the case, or not; the paramount overall consideration being the need for striking a judicious balance between the indispensable obligation to do justice at all stages and impelling necessity of avoiding prolongation in the life of any lis.” In the case of Mangalore Ganesh Beedi Works Vs. Commissioner of Income Tax, Mysore reported the (2015) 378 ITR 640 (SC), the apex Court has held as under:- In the case of Mangalore Ganesh Beedi Works Vs. Commissioner of Income Tax, Mysore reported the (2015) 378 ITR 640 (SC), the apex Court has held as under:- “19. We are not at all impressed with the submission of learned counsel for the Revenue. There is a clear finding of fact by the Tribunal that the legal expenses incurred by the Assessee were for protecting its business and that the expenses were incurred after 18th November, 1994. There is no reason to reverse this finding of fact particularly since nothing has been shown to us to conclude that the finding of fact was perverse in any manner whatsoever. That apart, if the finding of fact arrived at by the Tribunal were to be set aside, a specific question regarding a perverse finding of fact ought to have been framed - 18 - by the High Court. The Revenue did not seek the framing of any such question. In this regard, reference may be made to K.Ravindranathan Nair v. Commissioner of Income Tax[2001] 247 ITR 178 / 114 taxman 53 (SC) wherein it was observed: “The High Court overlooked the cardinal principle that it is the Tribunal which is the final fact-finding authority. A decision on fact of the Tribunal can be gone into by the High Court only if a question has been referred to it which says that the finding of the Tribunal on facts is perverse, in the sense that it is such as could not reasonably have been arrived at on the material placed before the Tribunal. In this case, there was no such question before the High Court. Unless and until a finding of act reached by the Tribunal is canvassed before the High Court in the manner set out above, the High Court is obliged to proceed upon the findings of fact reached by the Tribunal and to give an answer in law to the question of law that is before it.” 20. Accordingly, we hold that the High Court was not justified in upsetting a finding of fact arrived at by the Tribunal, particularly in the absence of a substantial question of law being framed in this regard. Therefore, we set aside the conclusion arrived at by the High Court on this question and restore the view of the Tribunal and answer the question in favour of the Assessee and against the Revenue.” 23-The Hon'ble Supreme Court in the case of Sir Chunilal V. Mehta & Sons Ltd. Vs. Century Spg. & Mfg. Co. Ltd. reported in AIR 1962 SC 1314, while agreeing with and approving a Full Bench judgment of this Court in Rimmalapudi Subba Rao Vs. Noony Veeraju and Ors. reported in AIR 1951 Mad 969 laid down principles as to when a question of law becomes a substantial question of law at all. With regard to “Substantial Questions of Law”, tests were laid down by the Hon'ble Supreme Court for finding out whether a given set of questions of law are mere questions of law or substantial questions of law and the same has been dealt with in the case of Hero Vinoth Vs. Seshammal reported in (2006) 5 SCC 545 case. The ratio / tests laid down by the Supreme Court finds place in paragraphs No.21 to 24 of the said judgment and the same reads as under:- V. Mehta & Sons Ltd. Vs. Century Spg. & Mfg. Co. Ltd. reported in AIR 1962 SC 1314, while agreeing with and approving a Full Bench judgment of this Court in Rimmalapudi Subba Rao Vs. Noony Veeraju and Ors. reported in AIR 1951 Mad 969 laid down principles as to when a question of law becomes a substantial question of law at all. With regard to “Substantial Questions of Law”, tests were laid down by the Hon'ble Supreme Court for finding out whether a given set of questions of law are mere questions of law or substantial questions of law and the same has been dealt with in the case of Hero Vinoth Vs. Seshammal reported in (2006) 5 SCC 545 case. The ratio / tests laid down by the Supreme Court finds place in paragraphs No.21 to 24 of the said judgment and the same reads as under:- “The phrase "substantial question of law", as occurring in the amended Section 100 of the CPC is not defined in the Code. The word substantial, as qualifying "question of law", means of having substance, essential, real, of sound worth, important or considerable. It is to be understood as something in contradistinction with technical, of no substance or consequence, or academic merely. However, it is clear that the legislature has chosen not to qualify the scope of "substantial question of law" by suffixing the words "of general importance" as has been done in many other provisions such as Section 109 of the Code or Article 133(1)(a) of the Constitution. The substantial question of law on which a second appeal shall be heard need not necessarily be a substantial question of law of general importance. In Guran Ditta v. T. Ram Ditta (AIR 1928 PC 172) , the phrase 'substantial question of law' as it was employed in the last clause of the then existing Section 100 CPC (since omitted by the Amendment Act. 1973) came up for consideration and their Lordships held that it did not mean a substantial question of general importance but a substantial question of law which was involved in the case. In Sri Chunilal's case [1962 Supp (3) SCR 549 : AIR 1962 SC 1314], the Constitution Bench expressed agreement with the following view taken by a full Bench of the Madras High Court in Rimmalapudi Subba Rao v. Noony Veeraju [AIR 1951 Mad. 969 : (1951) 2 MLJ 222 (FB)] : (Sir Chunilal case [1962 Supp (3) SCR 549 : AIR 1962 SC 1314], SCR P.557) When a question of law is fairly arguable, where there is room for difference of opinion on it or where the Court thought it necessary to deal with that question at some length and discuss alternative views, then the question would be a substantial question of law. On the other hand if the question was practically covered by the decision of the highest court or if the general principles to be applied in determining the question are well settled and the only question was of applying those principles to be particular facts of the case it would not be a substantial question of law. This Court laid down the following test as proper test, for determining whether a question of law raised in the case is substantial : (Sir Chunilal case [1962 Supp (3) SCR 549 : AIR 1952 SC 1314], SCR pp. 557-58). The proper test for determining whether a question of law raised in the case is substantial would, in our opinio