Misreading of record by the final fact-finding authority can vitiate findings and justify remand in reference jurisdiction.

A final fact-finding authority must independently examine the record and the assessee's explanation before sustaining rejected books or enhanced turnover. Where the Tribunal proceeds on a mistaken assumption about the assessing authority's treatment of loose slips, and thereby misreads the record or ignores admissible material, its finding is legally vitiated and cannot stand in reference jurisdiction. The High Court held that such an error of record justified interference, answered the referred questions in the assessee's favour, and remanded the matter to the Tribunal for fresh disposal after hearing the parties.

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Issues: Whether the Tribunal's finding rejecting the assessee's books and sustaining the enhanced turnover was vitiated by an error apparent on the face of the record, and whether the reference should be answered in the assessee's favour with the matter remanded to the Tribunal for fresh disposal.

Analysis: The Tribunal proceeded on the mistaken assumption that the explanation regarding the loose slips seized from the dealer's premises had been rejected by the assessing authority, whereas that explanation had in fact been accepted after remand. The High Court held that the Tribunal, as the final fact-finding authority, was required to examine the materials and the explanation independently, but instead acted under an erroneous impression and without applying its mind to the relevant material. A finding based on non-consideration of admissible evidence or on a misreading of the record is not binding and is liable to be interfered with in reference jurisdiction.

Conclusion: The Tribunal's order was vitiated by an error of record. The questions referred were answered in the affirmative and the matter was remanded to the Tribunal to dispose of the appeal afresh in accordance with law after hearing the parties.

Final Conclusion: The reference succeeded, and the Tribunal was required to rehear and decide the appeal on the merits in conformity with the High Court's answer.

Ratio Decidendi: A final finding of fact can be interfered with in reference jurisdiction where it is founded on non-consideration of admissible evidence or on a misapprehension of the record, because such a finding is legally vitiated and cannot stand.

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