TMI Blog2005 (12) TMI 89X X X X Extracts X X X X X X X X Extracts X X X X ..... rn in the assessee factory? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was legally justified in basing its conclusion with regard to wastages in the production of nylon yarn on the later certificate dated March 21, 1975, in preference to the earlier certificate dated December 21, 1971, of BASF produced before the Income-tax Officer? 3. Whether, on the facts and in the circumstances of the case, the Tribunal can be said to have permitted the assessee to make out an entirely new case on "invisible wastage". If yes, was the Tribunal legally justified in permitting the same?" The dispute relates to the assessment year 1971-72. The assessee-company manufactures nylon-6 yarn from caprolactum. This evolves th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad to be shown in addition that the accounts suffered from serious infirmities. (iv) No defects had been pointed out before the Tribunal to justify the rejection of the accounts. A mere deviation in the percentage of waste from year to year would not be sufficient to reject the accounts and to estimate the profits. Reliance by the Revenue on the decision of the Allahabad High Court reported in Raza Textiles Ltd. v. CIT [1972] 86 ITR 673 in this regard was misplaced. (v) The alleged discrepancies between the figures relating to opening stock and closing stock of waste regarding lactum issued from the godown, etc., (relied on by the Revenue) proved in reality to be no discrepancy. The assessee had furnished full and complete reconciliatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated under normal working conditions. We would like to point that during irregular operating conditions (e.g., shut-down period caused by power failure, scheduled maintenance or unscheduled repair work) a substantially larger percentages of waste will be generated..." A bare perusal of the aforesaid certificate would clearly show that the BASF opined that minimum 8 per cent. waste will be generated during the conversion of caprolactum to nylon-6 polymer under normal conditions. This certificate has been given by an expert body and there is no material on record to show that the said certificate was biased one as procured otherwise. After hearing counsel for the parties, we are satisfied that the findings recorded by the Tribunal are all ..... X X X X Extracts X X X X X X X X Extracts X X X X
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