Section 69B excess stock dispute turned on factual appraisal; no substantial question of law arose on appeal.

Appraisal of the books of account, stock records and monthly stock statements showed that the higher stock disclosed to the bank reflected inflated figures for banking purposes and did not establish any real excess stock outside the books. On that factual finding, the appellate authorities deleted the addition under section 69B, and the Tribunal affirmed the conclusion. The High Court treated the dispute as one of evidence appreciation rather than a legal issue, and held that no substantial question of law arose under section 260A. The addition was therefore not sustainable and the assessee succeeded.

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Issues: Whether the addition made under section 69B on account of alleged excess stock was justified and whether the concurrent findings deleting the addition gave rise to any substantial question of law under section 260A.

Analysis: The assessee's books of account and stock records were examined along with the monthly stock statements furnished to the bank. The lower appellate authority, after calling for a remand report under section 250(4), accepted the explanation that the higher stock shown to the bank reflected inflated stock figures arising from lower sales disclosure to the bank, and that there was no real excess stock outside the books. The Tribunal affirmed this factual finding. In such circumstances, the dispute turned on appreciation of evidence and not on any legal principle. The Court also noted that an identical approach had been treated as a conclusion of fact in similar circumstances.

Conclusion: The addition under section 69B was not sustainable, and no substantial question of law arose. The appeal was dismissed, in favour of the assessee.

Ratio Decidendi: Where the appellate fact-finding authorities, on appraisal of the books of account and surrounding evidence, record that there is no excess stock or unexplained investment, the matter remains one of fact and does not generate a substantial question of law under section 260A.

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