Factual finding on luggage receipts as income meant no referable question of law arose in reference proceedings.

Where the Tribunal found as a matter of fact that luggage transport on the assessee's buses involved no extra expenditure, its confirmation of the addition of luggage receipts as income was treated as a factual determination, not a legal one. The assessing authority had made a best judgment assessment after rejecting the books under the Income-tax Act, but in reference proceedings that factual finding could not be re-opened as a question of law. The High Court therefore declined to answer the referred question because no referable question of law arose.

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Issues: Whether the Tribunal was justified in confirming the separate addition of luggage receipts to the total income, and whether the question referred disclosed any question of law.

Analysis: The assessee's buses earned luggage charges in addition to passenger fares. The assessing authority, after rejecting the book results under the proviso to section 145(1) of the Income-tax Act, made a best judgment assessment and treated the entire luggage receipts as income. The Tribunal found as a matter of fact that the transport of luggage did not involve any extra expenditure and, on that basis, upheld the addition. In a reference, such a factual finding could not be re-agitated as a question of law.

Conclusion: The question referred did not raise any question of law and was declined to be answered.

Ratio Decidendi: Where the Tribunal records a pure finding of fact that a receipt involves no extra expenditure, no referable question of law arises from the confirmation of its treatment as income.

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