TMI Blog2004 (4) TMI 33X X X X Extracts X X X X X X X X Extracts X X X X ..... k J. -This appeal at the instance of the Revenue, filed under section 260A of the Income-tax Act, 1961 (for short "the Act"), is directed against the judgment and order passed by the Income-tax Appellate Tribunal on May 2, 2001. Respondent No. 1 is a limited company engaged, inter alia, in the business of leasing and financing. On December 2, 1996, respondent No. 1 (hereinafter referred to as "the assessee"), filed a return of its income declaring income of Rs. 3,54,930, during the assessment year 1996-97 on gross receipts of Rs. 6,71,11,527. In the profit and loss account, the assessee has debited a sum of Rs. 17,02,225 under the head "Depreciation", in respect of a machine called "Mechanical Skimmer Oil and Grease Removal System" (for short the "skimmer machine"). The assessee had shown this machine as its fixed asset and claimed 100% depreciation on it under rule 5 of the Income-tax Rules. The assessee had also claimed a sum of Rs. 3,95,000 as a business expenditure on account of foreign travel expenses incurred by its directors and consultants for the purpose of the business. The return filed by the assessee was processed under section 143(1)(a) of the Act, but was subsequent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x (Appeals), Belgaum. The Commissioner of Income-tax (Appeals) held that the Assessing Officer had proved to the hilt the bogus nature of the transaction of purchase of the skimmer machine and its lease. He also held that the assessee-company had not proved that the trips undertaken by the chairman, vice-chairman and the directors were incurred for the business of the assessee, because nothing tangible came out of the said foreign trips. He further held that the travel expenses of Mrs. Hede, wife of the vice-chairman, Shri P.R. Hede, were in no way related to the business of the appellant and, therefore, could not have been allowed as deduction. The appeal was accordingly dismissed by order dated October 3, 2000. The assessee carried the matter before the Income-tax Appellate Tribunal (for short "the Tribunal"). The Tribunal held that the assessee had proved beyond doubt that it had got fabricated the skimmer machine and that the same had been given under lease to H.C.C. It also held that the lease transaction was genuine. As regards the foreign travel expenses of Rs. 3,95,000, the Tribunal held that it cannot be said that the foreign travel was not wholly and exclusively for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndred and twenty days from the date on which the order appealed against is received by the assessee or the Chief Commissioner or Commissioner; (b) (omitted); (c) in the form of a memorandum of appeal precisely stating therein the substantial question of law involved. (3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (4) The appeal shall be heard only on the question so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question: Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question. (5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (6) The High Court may determine any issue which- (a) has not been determined by the Appellate Tribunal; or (b) has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consider the submission below. An assessee, aggrieved by an order passed by the Commissioner (Appeals), is entitled to file an appeal before the Tribunal under section 253 of the Act, both on questions of fact as well as law. A decision of the Tribunal on questions of fact is final and no appeal is provided to the High Court on questions of fact decided by the Tribunal. Under section 260A an appeal lies to the High Court only if the case involves substantial questions of law. Learned counsel for the appellant urged that the Tribunal erred in reversing the concurrent findings of facts reached by the Assessing Officer and the Commissioner (Appeals) that the transaction of purchase of the skimmer machine and its lease was bogus. Interfering in the concurrent findings of fact was erroneous and, therefore, submits learned counsel, a substantial question of law is involved. We are unable to agree. Since no restrictions are placed on the appellate power of the Tribunal, in our opinion, the Appellate Tribunal is entitled to reappreciate the evidence adduced before the Assessing Officer and/or the Commissioner (Appeals) and is entitled to reach its own conclusions on all questions of fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . against the Revenue. On the question of disallowance of foreign travel expenses of Rs. 3,95,000, it is admitted that the expenses included expenses of travel not only of the directors of the assessee-company, but also expenses for travel of Mrs. S.P. Hede, wife of the vice-chairman of the assessee. By a letter dated February 8, 1999, the assessee-company was called upon to explain and furnish evidence as to H how the foreign travel expenses were incurred wholly and exclusively for the business of the company. The assessee did not file any explanation or evidence in response to the said letter. As no evidence was adduced before the Assessing Officer, the Assessing Officer rejected the claim for foreign travel expenses and the finding was confirmed by the Commissioner (Appeals). The Appellate Tribunal has set aside the well-reasoned findings of the Assessing Officer and the Commissioner (Appeals). In paragraph No. 42, the Tribunal has observed that the mere fact that no tangible business came out of the foreign visits is not a ground for disallowing the foreign travel expenditure, because it is possible that in the first meeting only business discussions would take place and noth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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