TMI Blog2015 (5) TMI 517X X X X Extracts X X X X X X X X Extracts X X X X ..... considered view that the rate of 2766.76 paid by the Assessee to M/s. Marcandy Pd. Radha Pd. P. Ltd. on account of the conversion charges of pig iron & C.I. Scrap is excessive and unreasonable and is liable to be disallowed to the extent of its being so excessive or unreasonable. The rate of conversion adopted by the A.O. at ₹ 2,000/- per M.T. for the year under consideration is found reasonable and proper in as much as the assessee has not disputed as such this rate adopted by the A.O. We therefore direct to allow the deduction of conversion charges for pig iron & C.I. scrap @ ₹ 2,000/- per M.T. and to allow the conversion charges in respect of railway sleeper scrap @ ₹ 2,766.76 per M.T. as claimed by the Assessee The A. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee amounts to discharge of the burden and shifting of the onus on the assessing officer and in the facts and circumstances of the case could the assessing officer disagree with the offer without adequate materials to deny the explanation and alternatively could the onus shift on the assessee and would the assessee be entitled to an opportunity to explain the point of disagreement noted by the assessing officer? iii) Whether the tribunal was justified in law in disallowing ₹ 766.76 per M.T. in respect of pig from and C.I. Scrap out of the conversion charge of ₹ 2.766.76 per M.T. under Section 40A(w2) as excessive and unreasonable and its purported findings in that behalf are arbitrary, unreasonable and perverse? Mr. Mukher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned party (Marcandi Pd. Radha Pd (P) Ltd.) with whom assessee holding 37200 shares, it is more or less established that so far as expenditure or conversion charge is concerned, the assessee firm had made undue favour to said party by allowing conversion charge at exorbitantly high rate as compared to earlier year. After admitting the fact that there may be some increase in conversion charge in relevant year, I think ₹ 2000/- per M.T. should be optimum rate. In view of the above observation conversion charge (2766-76-2000) = 766.76 per M.T. is disallowed u/s 40A (2) of I.T. Act as excessive and unreasonable. Hence Rs.(1033.652 x 766.76) = 792563/- is disallowed. Being aggrieved, the appellant preferred appeal before the C.I.T.(A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We find that during the year under consideration the assessee got converted pig iron and C.I. Scrap to the extent of 476.417 M.T. and 49.260 M.T. respectively The Assessee has not given any explanation as to why the conversion charges in respect of pig iron and C.I. Scrap has been made at a rate of 2766.76 per M.T. as compared to 1749.04 M.T, paid in the last year there is no reason to Pay higher rate of conversion charges in respect of pig iron and C.I. Scrap The Assessee s case is only that the quality of railway sleeper scrap is generally of rough and of rejected sleeper and having of good amount of dust and rust resulting in the melting loss at a higher percentage than pig iron and C.I. Scrap Therefore paying the higher rate of convers ..... X X X X Extracts X X X X X X X X Extracts X X X X
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