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2014 (10) TMI 890 - HC - Income TaxUndisclosed income on account of the improper disclosure, or suppression of the production - Held that:- Superintendent of a Central Excise would not have ventured to record his own findings about the matters like burning losses or other relevant issues and would have chosen to avail of the services of a metallurgical expert. What we have extracted above is just a sample. The whole order is full of such discussions and instances. It is on the basis of such an exercise, that the Assessing Officer arrived at the conclusions that the undisclosed income on account of the improper disclosure, or suppression of the production for various assessment years is ₹ 1,22,86,712. Even the expenditure incurred for purchase of raw materials became the subject matter of extensive discussion, without indicating as to how the purchase of raw material can have any impact upon the income of an assessee, that too, of a manufacturing company. In the order of assessment, which runs into 31 closely typed pages, such instances are galore. Obviously, to analyse and understand the approach of the Assessing Officer, the Tribunal discussed the matter at length. The order passed by it runs into 48 pages. At more places than one, it was pointed out that the stock available on ground, cannot be compared or verified with reference to the RG-I register. It was also pointed out that by-products or waste materials, such as slag, was treated by the Assessing Officer as the main product or an income yielding material and the conclusions were arrived at, only on the basis of assumptions. We agree with the findings recorded and view expressed by the Tribunal. An Income-tax Officer cannot carry out the functions of an authority under the Central Excise Act and arrogate to himself the power to determine the quantity of production, or to utter a final word on the intricacies of the manufacturing process, that too, without referring to any reliable material. The Assessing Officer, in the instant case, was totally unsuited for undertaking the activity of determining the exact production of the material, which itself involves very complicated procedures. In the appeal of the assessee also, we do not find any substance. The amounts that were untouched by the Tribunal represent the value of the land that was purchased during the block period. The relevant facts and figures were taken into account and a proper conclusion was arrived at. We do not find any basis to interfere with the same. - Decided in favour of assessee
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