Reasonable cause for advance-tax default is a factual finding and does not, by itself, raise a question of law.

A finding that an assessee had reasonable cause for failing to file an advance-tax estimate or pay advance tax is a factual determination. Where the Tribunal accepts reasonable cause on the evidence, that conclusion does not by itself raise a referable question of law, including in relation to cancellation of penalty under section 273(b). Applying the same approach used for penalty under section 140A(3), the Court held that the controversy was confined to facts and declined to answer the reference.

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Issues: Whether the Tribunal's finding that the assessee had reasonable cause for not filing the estimate of advance tax or not paying advance tax, and for cancellation of penalty under section 273(b), gave rise to any question of law.

Analysis: The reference arose from penalties imposed for failure to furnish the estimate and pay advance tax under the advance-tax provisions. The Tribunal had found, on the facts, that there was reasonable cause for the assessee's default. The Court held that this finding was essentially factual, and applied the same approach as had been adopted in relation to penalty under section 140A(3), namely that acceptance of reasonable cause is a finding of fact and does not by itself generate a referable question of law.

Conclusion: No question of law arose from the Tribunal's order, and the Court declined to answer the referred questions.

Final Conclusion: The references were returned unanswered because the Tribunal's conclusion on reasonable cause was treated as a factual determination not open to further reference.

Ratio Decidendi: A finding that the assessee had reasonable cause for the default is a finding of fact, and where the controversy turns on such factual determination, no question of law arises for reference.

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