Write-off of advance for raw materials treated as a question of fact, leaving no substantial question of law.

Advance paid for procurement of raw materials was written off after the supplier ceased to exist in BIFR proceedings and recovery became doubtful. The controversy was whether deletion of the corresponding addition raised any substantial question of law or whether revenue could interfere with the write-off. The matter was treated as turning on appreciation of the accounts and surrounding factual circumstances, not on any legal principle requiring appellate interference. The write-off was therefore regarded as a pure question of fact, and the deletion of the addition was upheld.

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Issues: Whether the deletion of the addition relating to the advance amount written off by the assessee for supply of raw materials gave rise to any substantial question of law, and whether the amount written off could be interfered with by the revenue authorities.

Analysis: The advance was given for procurement of raw materials and, after the supplier ceased to exist pursuant to BIFR proceedings, recovery became doubtful. The amount was accordingly shown as written off in the books of account. The dispute was treated as turning on factual appreciation of the accounts and the surrounding circumstances, and not on any legal principle warranting interference in appeal.

Conclusion: The issue was held to be a pure question of fact, no element of law was found to arise, and the deletion of the addition was upheld.

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