Appellate finality bars Revenue from reopening reduced addition where it never challenged the Commissioner (Appeals)' order.

The Revenue could not challenge the percentage of addition sustained by the Tribunal in an appeal under Section 260A where it had not appealed against the Commissioner (Appeals)' order. In an assessment involving alleged bogus purchases and unexplained expenditure, the Commissioner (Appeals) restricted the addition to 12.5% and the Tribunal reduced it further to 10%. Because the Revenue had accepted the appellate order of the Commissioner (Appeals), it was precluded from seeking enhancement of the addition before the HC. The Court held that no substantial question of law arose, and the Revenue's appeal failed.

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Issues: Whether the Revenue could assail the percentage of addition sustained by the Tribunal when it had not challenged the order of the Commissioner (Appeals), and whether any substantial question of law arose in the appeal.

Analysis: The appeal arose under Section 260A of the Income-tax Act, 1961, from an assessment concerning addition for unexplained expenditure on alleged bogus purchases. The Commissioner (Appeals) had restricted the addition to 12.5% and the Tribunal had further reduced it to 10%. The Revenue had not filed any appeal against the order of the Commissioner (Appeals). In these circumstances, the Court held that the Revenue was precluded from questioning the percentage of addition fixed by the Tribunal, and no substantial question of law arose for consideration.

Conclusion: The issue was answered against the Revenue and in favour of the Assessee.

Final Conclusion: The Revenue's appeal failed on the ground that, having not challenged the order of the Commissioner (Appeals), it could not seek enhancement of the addition before the High Court.

Ratio Decidendi: A party that does not challenge an adverse appellate order cannot later seek to reopen the settled quantum of addition in further appeal, and no substantial question of law arises on that basis.

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