1 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR J U D G M E N T INCOME TAX APPEAL NO.139/2010 COMMISSIONER OF INCOME TAX, UDAIPUR Vs. M/S. TIRUPATI MICROTECH PVT. LTD. Date of Judgment : 13.12.2010 HON'BLE MR. JUSTICE A.M. SAPRE HON'BLE MR. JUSTICE C.M. TOTLA Mr. K.K. Bissa, for the appellant. BY THE COURT : (PER HON'BLE SAPRE,J.) The decision rendered in this appeal shall also govern disposal of other connected appeal being ITA No.19/2010 because both the appeals arise out of one order relates to one assessee. 2. This is an appeal filed by the Income Tax Department under Section 260-A of the Income Tax Act against an order dated 13.10.2009 passed by I.T.A.T., Jodhpur Bench, Jodhpur (for short called Tribunal) in I.T.A. No.264/JU/2009 for the period AY 2003- 2004. 3. By the impugned order, the Tribunal dismissed the Revenue's appeal and affirmed the order of Commissioner of Appeals on the issue raised in this appeal. 4. So the question that arises for consideration in this appeal is whether it involves any substantial question of law within the meaning of Section 260-A ibid? 2 5. Having heard the learned counsel for the appellant and on perusal of record of the case, we are inclined to dismiss the appeal in limine as in our opinion the appeal does not involve any substantial question of law as is required to be made out within the meaning of Section 260-A ibid. 6. The issue relates to certain additions made by the A.O. in the course of assessment proceedings initiated against the assessee under the Act. The A.O. did not accept the explanation offered by assessee and treating the said amount to be that of assessee added in his total income. The CIT (Appeal) deleted it and the Tribunal upheld the order of CIT (Appeal) and deleted the addition made by AO. In other words, the IT (Appeal) and Tribunal accepted the factual explanation coupled with the evidence tendered by assessee in relation to the impugned additions made by A.O. and held that since the same have been properly explained and hence, they cannot be included while computing the total income of the assessee. 6. In substance, the issue involved in the appeal was in relation to certain addition/deletion added by AO under Section 69 of the Act in the hands of assessee in the assessment year under consideration. The AO did not find explanation offered by assessee to be plausible and accordingly added the amount treating it to be an income from unexplained source. It was set aside by CIT (Appeal) and upheld by Tribunal in an appeal filed by the Revenue when appeal filed by Revenue was dismissed in part in so far as the impugned additions was concerned. 7. Learned counsel for the appellant (Revenue) contended that firstly Tribunal erred in accepting the explanation offered by Assessee in relation to source of income. His second submission was that what was offered by the Assessee was no explanation at all and hence it should not have been accepted. His third submission was to persuade us through factual scenario of the explanation to contend 3 that it can never be taken as satisfactory explanation for deleting the addition made by Assessing Officer and in last, he contended that when there were two statements made by assessee on the explanation relating to the impugned additions in proceedings before A.O., then the Tribunal should have relied on the one which supported the Revenue. We do not agree to any of these submissions for more than one reason. 8. In the first place, what is involved in the case is a pure question of fact and not any question of law much less substantial question of law. Secondly, this Court cannot again in this appeal undertake the examination of factual issues nor can draw factual inferences on the basis of explanation offered by assessee. Thirdly, once the explanation is accepted by 2 appellate authorities, then in such event, a finding recorded on such explanation is binding on the High Court. 9. Perusal of the impugned finding would go to show that Tribunal did examine the explanation offered by assessee in detail and then recorded a finding for its acceptance. Such finding when challenged does not constitute a substantial question of law within the meaning of Section 260A ibid in an appeal arising out of such order. 10. In our opinion, therefore, once the CIT (Appeal) and Tribunal accepted the explanation of assessee and accordingly, deleted certain additions made by A.O. then it would not involve any substantial issue of law as such. In other words, this Court in its appellate jurisdiction under Section 260-A ibid, would not again denovo hold yet another factual inquiry with a view to find out as to whether explanation offered by assessee and which found acceptance to the Tribunal is good or bad, or whether it was rightly accepted, or not. It is only when the factual finding recorded had been entirely dehors the subject, or that it had been based on no reasoning, or based on absurd reasoning to the extent that no prudent man of 4 average judicial capacity could ever reach to such conclusion, or that it had been found against any provision of law, then a case for formulation of substantial question of law on such finding can be said to have been made out. 11. In our view, no such error could be noticed by us in the impugned order because as observed supra, the CIT (Appeal) and Tribunal did go into the details of explanation offered by assessee and then accepted the explanation. As a consequence thereof, the additions made by Assessing Officer came to be deleted. 12. Coming to the last submission of learned counsel for the appellant as to which out of two statements should have been relied on, we find no merit in the same because even this issue was rightly dealt with and appreciated by the Tribunal. In our view it does not involve any substantial question of law because it is only a matter relating to explaining the source of income by the assessee and nothing else. It was for the Tribunal on facts to appreciate the explanations offered by the assessee and then record the finding on such facts. It was done. It is end of the issue so far as facts are concerned. 12. We thus, do not find any merit in the appeal. It fails and is dismissed in limine by holding that it does not involve any substantial question of law. No costs. [C.M. Totla ], J. [A.M. Sapre],J. /Anil/