TaxTMI 
TaxTMI 
2009 (4) TMI 506
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....eal are that the appellant is a partnership firm. It carries on business in execution of transport contract. In the year 1992-93, the appel-lant filed its return disclosing the net income at Rs. 1,95,120. The said return was scrutinized by opposite party No. 6-Income-tax Officer (here-inafter called, "the Assessing Officer"), who vide his order dated February 17, 1995, passed under sections 143(3) and 182(1) of the Income-tax Act, 1961 (hereinafter referred to as "the IT Act"), determined the net income at Rs. 3,00,120. Subsequently, by exercising powers under section 263 of the Income-tax Act, the Commissioner of Income-tax-opposite party No. 3, vide his order dated March 27, 1997, set aside the order of assessment with certain directions to the Assessing Officer to pass a fresh assessment order on the ground that the assessment order was erroneous and prejudicial to the interests of the Revenue. Pursuant to the said order of the Commis-sioner of Income-tax-opposite party No. 3, the Deputy Commissioner of Income-tax, Berhampur Circle, Berhampur-respondent No. 5 (hereinafter referred to as the "the Deputy CIT") scrutinized the accounts of the appel-lant. The Deputy Commissioner of ....
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....ross contract receipt, the learned Tribunal is not justified in estimating the same at 7.5 per cent. The estimation of profit at 7.5 per cent. of the gross contract receipt is at the higher side. 4. Mr Pattanaik relying upon the judgments of the Madras High Court in Mysore Fertiliser Co. v. CIT [1966] 59 ITR 268 (Mad) and the hon'ble apex court in CIT v. Indo Nippon Chemicals Co. Ltd. [2003] 261 ITR 275 (SC), argues that the question raised by the appellant in the present case is a substantial question of law. 5. Mr A. Mohapatra, learned counsel appearing for the Revenue strongly opposing the same contends that the appeal under section 260A can only be entertained where a substantial question of law is involved, and the instant case involves no substantial question of law. The Tribunal is the final fact finding authority. Following its earlier order the learned Tribunal has esti-mated the net profit at the rate of 7.5 per cent. in the case of the appellant. Besides, once the books of account are rejected, it is open to the Assessing Officer as well as the appellate authorities to estimate the reasonable profit from the business considering the facts and circumst....
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.... whether a substantial question of law is involved. The tests are : (1) whether directly or indirectly it affects substantial rights of the parties, or, (2) the question is of general public importance, or, (3) whether it is an open question in the sense that the issue is not settled by the pronouncement of the Supreme Court or the Privy Council or by the Federal Court, or (4) the issue is not free from difficulty, and (5) it calls for a discussion for an alternative view. 13. In Kondiba Dagadu Kadam v. Savitribai Sopan Gujar, AIR 1999 SC 2213 the hon'ble Supreme Court held that it has to be kept in mind that the right of appeal is neither a natural nor a inherent right attached to the liti-gation. Being a substantive statutory right, it has to be regulated in accord-ance with law in force at the relevant time. The condition mentioned in the enabling section must be strictly fulfilled before an appeal can be main-tained and no court has the power to add to or enlarge those grounds. The appeal cannot be decided on merely equitable grounds. Concurrent find-ings of fact, howsoever erroneous, cannot be disturbed by the High Court in exercise of the powers under this section. The sub....
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.... the provisions contained in section 260A of the Income-tax Act and the above legal propositions. 21. Admittedly, in the instant case, the assessee's grievance is that the esti-mation of the net profit at 7.5 per cent. is at a higher side and based on no reason. The learned Income-tax Appellate Tribunal after considering the submissions of the learned counsel for both the sides and going through the orders of the Assessing Officer and the first appellate authority came to the conclusion that in the appellant's case the reasonable profit would be 7.5 per cent. of the gross receipt. While doing so, it relied upon its earlier order passed in I. T. A. No. 293/Ctk/1991 in this case of Shri Madhusudan Dixit, Bolangir, what would be reasonable rate of profit in this case has been decided by the learned Tribunal on the basis of the case history of the assessee. The findings recorded by the Tribunal are pure findings of fact and do not give rise to any substantial question of law for consideration by the High Court. 22. In Mysore Fertiliser Co.'s case [1966] 59 ITR 268 (Mad), the Madras High Court held that where an Income-tax Officer has adopted a wrong method under sec....