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Judgment
On an application filed u/s 256(1) of the Income Tax Act, 1961 (hereinafter referred to as ''the Act'') the Tribunal has referred the following questions for our opinion :
"Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that a sum of Rs. 8,000 out of the mess expenses incurred by the applicant for the purposes of the business were not allowable ?
Whether, on the facts and in the circumstances of the case, the Tribunal had any material or any evidence in holding that the expenditure on consumption of stores and coal is disallowable to the extent of Rs. 30,000 ?
Whether, on the facts and in the circumstances of the case, the Tribunal had any material or evidence in disallowing a sum of Rs. 70,000 out of the expenditure under the head ''Consumption of Hexine'' ?"
The relevant assessment year is 1975-76. The assessee declared a loss of Rs. 28,22,180. During the course of assessment, the assessing officer noticed that assessee had incurred excess expenditure on mess, consumption of stores and coal and consumption of Hexine. The additions made by the assessing officer have been reduced by the Tribunal to the tune of Rs. 8,000, 30,000 and 70,000, respectively.
None appeared for the assessee. Heard the learned counsel for the revenue. Considering his submissions and on perusal of the orders of the authorities, in our view whether the expenditure so incurred by the assessee, was for the purpose of business or not and whether that expenditure was genuine or not, is basically a question of fact. A perusal of the order of the Tribunal shows that the finding of fact is not perverse, therefore, no interference is called for.
In the result, we answer all these three questions in the affirmative, i.e., in favour of revenue and against the assessee.
Reference so made stands disposed of accordingly.