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TMI Blog2010 (2) TMI 755X X X X Extracts X X X X X X X X Extracts X X X X ..... el Jagdish for the Respondent ORDER R.K. Gupta: This is an appeal by the department against the order of the CIT(A) relating to assessment year 2005-06. 2 The department is objecting in deleting the addition of Rs.64,53,524/- made by the AO on account of suppressed production. 2.1 In this case, the return of income of Rs.1,95,25,532/- was filed on 27.10.2005 against which the assessment was completed on a figure of Rs.2,60,15,183/- after making the addition on account of suppressed production of Rs.64,53,524/-. 2.2 During the course of assessment proceedings, the AO noticed that there were some discrepancies in the Central Excise Registers representing variation in the percentage of output in each category of ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed production and additions were made in the block period and thereafter upto AY 2004-05. 2.4 It was submitted before the AO that upto AY 2004-05 including block period, the entire additions have been deleted by the Tribunal; therefore, there is no change in the facts and no addition can be made for the year under consideration. Thereafter, the AO examined the books of account along with Excise Registers. The AO noted that there was a variation in the percentage of scrap shown in various items of raw material. It was seen that in respect to circle cutting, scrap/wastage has been shown at 20% to 27%; in the case of deep drawing/pressing, it has been shown at 2% to 3%; in the case of trimming and slot cutting it has been shown at 3% to 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that in earlier years also identical additions were made which have been deleted either by the ld CIT(A) or by the Tribunal. It was explained that day-to-day books of accounts were maintained. All the purchases and sales were vouched. All the stock inward and outward entries were vouched by the Sales Tax Authorities/Excise Authorities. There was no material with the AO to reject the contention of the assessee. 3.1 With regard to the Annexure attached, it was pointed out that variations in wastage percentage were filed with respect to each raw material and not with respect to each activity or each different item made from those raw materials. It was explained that in the Annexure to the assessment order, the AO only made categories of r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the ld CIT(A), found that there is no change in the facts of the year under consideration as compared to the facts of the earlier years. The CIT(A), after examining the written submissions and Annexure I attached with the assessment orders found that the AO had worked out the said variation after examining a particular type of raw material i.e. patta, tubes, rods etc. and not in respect to each finished products made from these materials; therefore, the CIT(A) drew the conclusion that the AO has not compared like with like. It is noticed by the CIT(A) that the ld AR has been able to demonstrate that there are errors in the computation of percentages in the assessment order/annexure. It was further noted that the ld AR has demonstrated tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not pointed out. On the other hand, the ld counsel of the assessee placed reliance on the order of the ld CIT(A). It was further submitted that the items produced by the assessee are subject to excise check. Strict check has been kept by the Excise department. The assessee is required to maintain register under Rule 6F(3) and accordingly, return have been filed before Excise department. Whatever the wastage of scrap is generated that has to be shown in the return of excise and the same has been shown and the Excise Department has accepted the wastage/scrap shown by the assessee. Whatever the scrap has been shown in the books of account, the same quantity has been allowed. There was no material with the AO to reject the books of account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of the Tribunal as well as of the ld CIT(A) for earlier years. There is a difference of percentage of scrap in each item but there is no difference of the same items as compared to earlier years. The CIT(A) has noted this point in his order. He has observed that the comparison should be made like with like and the AO has failed to do so. 6.1 Identical facts were involved in earlier year and after taking into consideration the facts, the Tribunal has allowed the claim of the assessee upto AY 2004-05. Copies of the orders of the Tribunal are placed on record. The last order passed for AY 2003-04 and 2004-05 in ITA No.2399 and 2400/Mum/08 vide order dated 29.5.2009. This order was passed following the order of the Tribunal in earlier ye ..... X X X X Extracts X X X X X X X X Extracts X X X X
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