LexCOMMISSIONER OF INCOME TAX, CALCUTTA versus KARAM CHAND THAPAR & BROS. (P) LTD.
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A B COMMISSIONER OF INCOME TAX, CALCUTTA v. KARAM CHAND THAPAR & BROS. (P) LTD. FEBRUARY 14, 1989 [M.H. KANIA AND L.M. SHARMA, JJ.] ·'r Constitution of India, 1950---Artic/e 136-Tribunal's decision on question of fact-Such a finding not to be interfered with unless it is ·--+··. based on irrelevant material or perverse. \ C Income-tax Act, 1961: Section 256-Reference io High Court- Question of fact or law-Assessee claiming loss on sale of shares- Whether capital loss, or business loss or genuine or bogus-Only ques- tion of fact-Tribunal's decision final-Tribunal need.not specifically state its taking into account the cumulative effect of the circum.i;tances- D Court not to interfere unless Tribunal's decision is based on irrelevant consideration or perverse. For the assessment year 1959-60, the Income Tax Officer dis- ~ ' allowed the loss claimed by the Respondent-assessee, on the sale of E certain shares, to its allied concern, on the grounds that the sale price was much below the market quotation and that the motive behind the transactions was to set off the loss against the profits and hence the transactions w.ere not genuine. F G H On appeal by the assessee the Appellate Assistant Commissioner f "T-- held that the losses on both the transactions cannot be held to be busi- ness losses. On a 'further appeal by the assessee, the Tribunal observed that the~e was nothing to show that the transactions in questioll had any- thing to do with the control of the companies concerned. It also relied upon the circumstance that the sales were at the market rates or going ~ - rates and held that there was no question. of making a bogus loss. Based on these facts and circumstances, the Tribunal held that the losses in respect of the .sales of the shares in question, were liable to be allowed as business losses. 638 C.l.T. v. K.C. TIIAPAR 639 The Commissioner of Income Tax made an application lo the A Tribunal for referring certain questions for the determination of the High Court. The Tribunal declined to refer the questions on the ground that they were not questions of law, which deserved to be referred to the Court for determination. This order of the Tribunal was confirmed by the High Court. This appeal, by special leave, is against the said order of the High Court. Dismissing the appeal, B HELD: 1. Where the Tribunal bas come to the conclusion that C the loss incurred by the assessee in the sale of shares held by it was a trading loss and it is not the case of the Department' that in arriving at its decision the Tribunal had taken into consideration any irrelevant material or failed to take into consideration any relevant material, there is no room for interference by the court. It is well settled that the D ·Tribunal is the final fact finding body. The questions whether a particu· lar loss is a trading loss or a capital loss and whether the loss is genuine or bogus are primarily questions which have lo be determined on the appreciation of facts. The findings of the Tribunal on these questions are not liable to be interfered with. unless the Tribunal has taken into E consideration any irrelevant material or has failed to take into con- sideration any relevant material or the conclusion arrived at by the Tribunal is perverse in the sense that no reasonable person on the basis , of the facts before the Tribunal could have come to the conclusion to -rl.f which the Tribunal has come. l645B-D] C.I. T., Bihar & Orissa v. Dalmia Jain & Co. Ltd., 11972] 83 ITR 438, relied on. 2. It is equally well settled that the decision of the Tribunal bas not lo F be serntinised sentence by sentence merely lo find out whether all facts G have been set out in detail by the Tribunal or whether some incidental fact which appears on record bas not been noticed by the Tribunal in its judg- ment. H the court, on a fair reading of the judgment of the Tribunal, finds that it bas taken into account all relevant material and bas not taken into account any irrelevant or impermissible material in basing its conclusious, the decision of the Tribunal is not liable lo be interfered with, onless, of H 640 SUPREME COURT REPORTS [1989] 1 S.C.R. A course, the conclusions arrived at by the Tribunal are perverse. [645D- 'r F] 3 •. In the instant case, the Tribunal has taken note of, all the relevant circumstances which appear on record and which were refer- red to by the Departmental Repr
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