9911796707
TMI Blog2015 (5) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment year 2005-06, claiming the following substantial questions of law : "(i) Whether, in the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in confirming the order of the Commissioner of Income-tax (Appeals) in not sustaining the addition made by the Assessing Officer on account of suppressed production, without appreciating the fact that consumption of electricity is a good measure of suppressed produced, as held by the hon'ble Supreme Court in the case of Melton India v. Commissioner of Trade Tax, U.P. (Appeal (Civil) No. 373 of 2007, dated January 31, 2007 - [2007] 5 VST 613 (SC)) ? &nb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ?" 2. Put short, the facts necessary for adjudication of the instant appeal as narrated therein may be noticed. The original assessment was completed by the Assessing Officer under section 143(3) of the Act, vide order dated October 26, 2007, at an income of Rs. 13,46,201 by making an addition of Rs. 12,95,975 on account of suppressed sale of finished goods. Later on, the Commissioner of Income-tax (CIT), vide order dated August 10, 2009, cancelled the assessment under section 263 of the Act and directed the Assessing Officer to pass a fresh assessment order. Against the order of the Commissioner of Income-tax dated August 10, 2009, the assessee filed an appeal before the Tribunal who, vide order dated February 28, 2011, dismissed the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come-tax (Appeals) as well as the Tribunal have erred in reversing the order of the Assessing Officer and wrongly applied the gross profit rate of 23 per cent on the total turnover of Rs. 93,26,096. 4. After hearing learned counsel for the appellant, we do not find any merit in the aforesaid contention. 5. No doubt, the power consumption is one of the factors of production where there can be large variance and in the given facts and circumstances, the basis of power consumption can be taken to be a factor for determining the income of the assessee. However, in the absence of any corroborative evidence to support that, it cannot conclusively be taken to form the basis for assessing the income as the consumption of power necessarily may not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s inconclusive so as to arrive at a figure of actual production and sales. It is for this reason that there is enumeration of many facts required to be collected by the Revenue for the purpose of reaching a conclusion in respect of this evidence which has been discussed in the submission in the foregoing paragraphs. (e) At the same time it is admitted position that the appellant has himself accepted that there could be variation of some percentage which itself is a proof that books of account are not reflecting the correct picture. There is suspicion and doubt on the figure of electricity consumption, etc. As a result it is inescapable conclusion that the books of account of the appellant could not be relied upon for the purpose of determi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ete appreciation of arguments, facts and circumstances and records." 7. The Tribunal affirmed the order of the Commissioner of Income-tax (Appeals) with the following observations : "In I. T. A. No. 692/Chd/2012 and I. T. A. No. 707/Chd/2012, i.e., appeals filed in the case of M/s. Ram Steel Industries, the issue arising is identical to the issue arising in the earlier appeals and the same reasoning is to be applied in order to determine the income in the hands of the assessee for the captioned assessment year. The assessee is engaged in the production only. In the original round of assessment, the suppressed production in the hands of the assessee was agreed u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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