Law: Income Tax Act, 1961

Section: 256

(a) Income-tax----Capital or revenue expenditure---Tea estate---Expenditure on replanting--¬Finding by Tribunal that there was no evidence that replanting was done on virgin area---Expenditure was deductible---Indian Income Tax Act, 1961--¬Indian Income-tax Rules, 1962, R.8(2). (b) Income-tax--- ----Reference---Finality of findings of fact---Powers of High Court---Power to reframe question---Power cannot be exercised for reopening question of fact or law closed by order of Tribunal---Indian Income Tax Act, 1961, S.256. The Appellate Tribunal is the final fact-finding authority under the Income-tax Act and the Court has no jurisdiction to go behind the statements of facts made by the Tribunal in its appellate order. The Court may do so only if there is no evidence to support the findings or the Appellate Tribunal has misdirected itself in law in arriving at the findings of fact. But even there, the Court cannot disturb the findings of fact given by the Appellate Tribunal unless a challenge is directed specifically by a question framed in a reference against the validity of the impugned findings of fact on the ground that there is no evidence to support them or that they are the result of a misdirection in law. It is open to the High Court to reframe a question. But this power to reframe a question can be exercised to clarify some obscurity in the question referred, or to pinpoint the real issue between the taxpayer and the Department or for similar other reasons; it cannot be exercised for reopening an enquiry on questions of fact or law which is closed by the order of the Tribunal. Held, that, in the instant case, the Tribunal had found that there was no evidence that the replanting was done in a virgin area. This finding had not been challenged as being perverse and was final. The Tribunal was justified in allowing deduction of the expenditure incurred in replanting in the tea estate. CIT v. Anusuya Devi (Sint.) (1968) 68 ITR 750 (SC); CIT v. Basanta Kumar Agarwalla (1983) 140 ITR 418 (Gauhati); CIT v. Mahavir Plantations Ltd. (1995) 213 ITR 485 (Ker.); Kilasho Devi Burman. (Smt.) v: CIT (1996) 219 ITR 214 (SC) and Patnaik & Co. Ltd. v. CIT (1986) 161 ITR…

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