B. P. JEEVAN REDDY, CJ. ( 1 ) UNDER Section 256 (2) of the Income-tax Act, 1961, the Tribunal has stated the following two questions : " (1) Whether, on the facts and in the circumstances of the case, the onus placed on the assessee under the Explanation to Section 271 (1) (c) of the Income-tax Act, 1961, has been discharged by it ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was legally correct in cancelling the penalties of Rs. 4,000 and Rs. 43,000 imposed by the Inspecting Assistant commissioner under Section 271 (1) (c) read with its Explanation for the assessment years 1967-68 and 1968-69, respectively ?" ( 2 ) THE assessee is a registered firm engaged in the business of export of brassware. We are concerned with the assessment years 1967-68 and 1968-69. The assessee filed returns disclosing particular incomes. The Income-tax Officer, however, did not accept the gross profit disclosed by the assessee and added certain amounts. It is sufficient to mention that the Income-tax Officer worked out the profit at 18 per cent. , which, on appeal, was reduced to 17. 7 per cent ( 3 ) PROCEEDINGS for penalty were initiated. Inasmuch as the returned income was less than 80% of the assessed income, the Income-tax Officer held that the burden lay upon the assessee to disprove the presumption arising from the Explanation to Section 271 (1) (c), which was added by the Finance Act, 1964. Holding that the assessee has failed to rebut the same, penalties were imposed. On appeal, the Tribunal, found that the assessee has successfully rebutted the presumption arising from the said Explanation. The Tribunal considered the facts and circumstances of the case in the light of the explanation offered by the assessee and came to the finding of fact that the assessee has rebutted the presumption arising from the Explanation. It being a question of fact and also because we are unable to say that this finding is based on no evidence, we are unable to interfere. ( 4 ) LEARNED counsel for the applicant referred to the decision of the Supreme Court in CIT v. Mussadilal Ram Bharose [1989] 165 ITR 14, where the aforesaid Explanation and its effect were discussed. There can be no quarrel about the proposition of law. ( 4 ) LEARNED counsel for the applicant referred to the decision of the Supreme Court in CIT v. Mussadilal Ram Bharose [1989] 165 ITR 14, where the aforesaid Explanation and its effect were discussed. There can be no quarrel about the proposition of law. On the facts of this case, however, the Tribunal held that the said presumption has been rebutted and since we are not in a position to say that it is based on no evidence, we cannot interfere. ( 5 ) FOR the above reasons, both the questions referred are answered in the affirmative, i. e. , in favour of the assessee and against the Department. No costs. .