Factual findings on stock discrepancy and pledged inventory did not raise a referable question of law, making the reference academic.

The Tribunal's deletion of the addition relating to stock pledged with the bank was treated as a finding of fact, reached on material and circumstantial evidence showing the stock statements were mechanical and motivated and that the alleged stock discrepancy was not sustainable. On that basis, no referable question of law arose from the main issue. The subsidiary challenge to the CIT's reduction of the addition was only consequential and became academic once the entire addition was deleted, so it too did not warrant a reference. The reference applications were therefore rejected.

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Issues: Whether any referable question of law arose from the Tribunal's findings deleting the addition relating to the stock pledged with the bank and sustaining the CIT's reduction.

Analysis: The reference applications were founded on the Tribunal's factual findings that the stock statements furnished to the bank were mechanical and motivated and that the addition made on account of alleged stock discrepancy was not sustainable. Those findings were based on the material and circumstantial evidence and were treated as findings of fact. The further issue regarding the CIT's reduction of the addition was only consequential to the main finding and, in view of the deletion of the entire addition, had become academic.

Conclusion: No referable question of law arose.

Final Conclusion: The reference applications failed and were rejected because the issues raised were concluded by findings of fact and did not warrant a reference.

Ratio Decidendi: Findings reached by the Tribunal on the basis of evidence and surrounding circumstances, when purely factual, do not give rise to a referable question of law; a consequential issue rendered academic by the main factual determination also does not survive for reference.

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