Commissioner of Income Tax vs Hans Marble Industries (P) Ltd.

Instant appeal filed u/s 260A of the IT Act, 1961 is directed against the judgment dt. 19th Dec, 2006 rendered in ITA Nos. 363 & 370/Jd/2001 (for the asst. yr. 1998-99), by the Tribunal, Jodhpur Bench by which the appeal filed by the assessee as well as Revenue has been partly allowed for statistical purpose only.

According to Mr. K.K. Bissa, learned Counsel following substantial question of law arises out of the order of the Tribunal:

Whether on the facts and in the present circumstances of the case as well as in the law, the learned Tribunal is justified in upholding the learned CIT(A)''s decision that the assessee fulfilled both the conditions of Section 32A(4)(i) of the IT Act, ignoring the facts of the case and allowing investment allowance of Rs. 6,14,450?

Before the Tribunal Revenue has raised two grounds of appeal. We are concerned with second ground of appeal only. The facts of the ground No. (ii) of the Revenue''s appeal before the Tribunal are that the AO has disallowed the claim of investment allowance on the plea that no particulars of plant and machinery were furnished and no investment allowance reserve was created. The assessee''s case is that vide letter dt. 14th March, 2001 it had given a complete list along with copies of ledger accounts and the photocopies of invoices, but the AO failed to consider these evidences. However, CIT(A) allowed the claim of investment allowance.

While answering the aforesaid ground the Tribunal has held that total investment in the plant and machinery was Rs. 30,82,291 on which claim of investment allowance was made at Rs. 6,16,458 for which necessary note was appended to the audited annual accounts for the year ended on 31st March, 1990, a copy of which was also furnished to the AO. The AO has disallowed the same because according to him (i) no particulars regarding plant and machinery were furnished, and (ii) no investment allowance reserve was created.

Considering the factual matrix of the case and the submissions advanced by learned Counsel for the parties and the evidence produced on record, the Tribunal has come to the conclusion that assessee vide letter dt. 14th March, 2001 gave a complete list of plant and machinery along with copies of ledger accounts and invoices, so first condition of Section 32A is fulfilled. Insofar as the second condition of creating an investment allowance reserve, it was contended that before the completion of assessment particulars, vide letter dt. 12th March, 2001 it was made clear that in case the income of the assessee comes to positive, benefit of investment allowance may please be given. The Tribunal observed that it is true that originally the assessee had not created a requisite reserve, but it created reserve in the revised audited balance sheet for the year ended 31st March, 1996 and utilized the same partly in the said year and partly in the year 31st March, 1997. All the balance sheets as on 31st March, 1996, 31st March, 1997 and 31st March, 1998 were furnished before the AO along with respective audit reports. Tribunal opined that assessee company can revise its accounts to meet the technical requirements of the tax laws. The company revised its accounts and filed the copy of the same before the AO. In these circumstances, Tribunal has given finding that CIT(A) has rightly allowed the claim of assessee as it had fulfilled both the conditions of Section 32A(4)(i) of the Act.

According to us the aforesaid finding given by the Tribunal is the finding of fact and so far as the Tribunal is concerned, it is last finding of facts authority and in this appeal no question of law much less the substantial question of law has arisen out which requires to be answered by this Court. The question of law which is formulated by the learned Counsel for the appellant is not a question of law but a question of fact.

Seen in the above context, instant appeal lacks merit as no substantial question of law is involved in this appeal, therefore, the same deserves to be dismissed at the admission stage.

For the foregoing reasons, the appeal fails and accordingly it is dismissed at the admission stage.