Judgment

PATHAK, J.:- This appeal by special leave is directed against the judgment of the High Court of Orissa and raises the famiIiar question whether a loss suffered by the assessee is a capital loss or a revenue loss.

2. The assessee deals in automobiles and also sells spare motor parts. For the assessment year 1963-64, the relevant accounting period being the year ended March 31, 1963, the assesses claimed a loss of Rs. 53,650/- sustained by it on disposing of subscription to the Orissa Government Floated Loan 1972. It claimed that the loss suffered by it was revenue loss and, therefore, deductible against its profits for the year. The Income-tax Officer disallowed the loss in the view that it was a capital loss. The assessees appeal was dismissed by the Appellate Assistant Commissioner of Income-tax. But on second appeal the Income-tax Appellate Tribunal accepted the contention of assessee that the subscription to the Government Loan was conducive to its business and the loss arose in the course of the business, and that, therefore, the assessee was entitled to a deduction of the loss claimed by it. The Accountant Member and the Judicial Member wrote separate but concurrent orders. At the instance of the Revenue the Appellate Tribunal referred the case to the High Court of Orissa for its opinion on the following question of law:

"Whether, in the facts and circumstances of the case, the loss of Rs. 53,650/- sustained by the assessee on the sale of the Government Loan is a capital loss or a revenue loss."

3. Disagreeing with the findings of the Appellate Tribunal the High Court held that the loss was a capital loss and accordingly answered the reference in favour of the revenue and against the assessee.

4. At the outset, we find it necessary to note that the High Court has taken the view that the factual substratum of the case has been misconceived by the Appellate Tribunal and that it is, therefore, entitled to re-examine the evidence and arrive at its own findings of fact. We think the High Court fell into serious error in doing so. It is now well settled that the Appellate Tribunal is the final fact-finding authority under the Income-tax Act and that the Court has no jurisdiction to go behind the statements of fact made by the Tribunal in its appellate order. The Court may do so only if there is no evidence to support them or the Appellate Tribunal has misdirected itself in law in arriving at the findings of fact. But even there the Court cannot disturb the findings of fact given by the Appellate Tribunal unless a challenge is directed specifically by a question framed in a reference against the validity of the impugned findings of fact on the ground that there is no evidence to support them or they are the result of a misdirection in law. There is a long line of cases decided by this Court laying down this proposition. See India Cements Ltd. v. CIT, 60 ITR 52, Hazarat Pirmahomed Shah Saheb Roza Committee v. CIT, (1967) 63 ITR 490, 495-6, C.I.T. v. Greaves Cotton & Co. Ltd., (1968) 68 ITR 200, C.I.T. v. Meenakshi Mills Ltd., 63-ITR 609,613, C. I. T. v.. Madan Gopal Radhey Lal, 73 ITR 652, 656, Hooghly Trust Ltd. v. CIT, 73 ITR 685, 690, CIT v. Imperial Chemical Industries (India) Ltd., 74 ITR 17 & Aluminium Corpn. of India Ltd, v. CIT, 86 ITR 11. The High Court has relied on Commr. of Income-tax, Bihar and Orissa v. S. P. Jain 87 ITR 370, to justify its re-examination of the evidence and to supersede the findings of fact rendered by Appellate Tribunal by findings of fact reached by itself. In that case, however, the questions raised in the Reference before the High Court included questions specifically challenging the findings of fact reached by the Appellate Tribunal as being invalid in law. In the present case the question referred to the High Court was framed on the assumption that it had to be decided in the factual matrix delineated by the Appellate Tribunal: In the circumstances, the findings of fact set forth in the j