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TMI Blog1962 (1) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... s available for crushing were 32,656 maunds, the oil yielded after crushing was 9,472 maunds and the oil cakes yielded were 20,814 maunds. The Income Tax Officer was of the opinion that the yield of oil and oil cakes from the crushing of the mustard seeds was below the normal. He, accordingly, after allowing a refraction of 2% held that the production of oil should be 32% and that of the oil cakes 66%. Calculating on this basis the oil yield should have been 10,241 maunds and production of oil cakes should have been 21,762 maunds. On this basis there was a shortage of 499 maunds of oil. He added a sum of ₹ 27,445 as the price of this unaccounted for oil at the rate of ₹ 55 per maund. He further added a sum of ₹ 4,740 as the price of the 948 maunds of oil cakes at the rate of ₹ 5 per maund. On appeal the Assistant Commissioner affirmed the decision of the Income Tax Officer. Before the Appellate Assistant Commissioner the assessee contended that the above rates were too high and that in the subsequent year when the milling was done in the presence of an officer of the Central Excise Department, production of oil and oil cakes was found to be much less. The Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant, it is impossible to say to what extent the mind of the court was affected by the irrelevant material used by it in arriving at its finding. Such a finding is vitiated because of the use of inadmissible material and thereby an issue of law arises. In that case the question which were asked to be referred to the High Court for opinion were as follows : 1. Whether on the facts and circumstances of the case the assessee was doing business in shares in the account year; or, 2. Whether there is any material on record on the basis of which it could be held that the assessee was doing the business in shares in the account year. 7. Both the Tribunal and the High Court held that no question of law arose. The Supreme Court reversed the decision of the Tribunal and held that the question of law arose in the case and remanded the case to the High Court with the direction that it should ask the Tribunal to state a case and to refer to it the following question of law : Whether the finding of the Tribunal is not vitiated by reason of its having relied upon suspicions and surmises not supported by any evidence on the record or upon partly inadmissible material ? 8. In the case of Meht ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the High Court in the matter of Income Tax references is an advisory jurisdiction and under the Income Tax Act the decision of the Tribunal on facts is final, unless it can be successfully assailed on the ground that there was no evidence for the conclusion on facts recorded by the Tribunal or the conclusion was such as no reasonable body of persons could have arrived at. It is also well settled that the duty of the High Court is to start with the statement of the case as the final statement of the facts and to answer the question of law with reference to that statement. 11. The counsel for the assessee has referred to the following observations in the case of Omar Salay Mohammed Sait v. Commissioner of Income Tax : We are aware that the Income Tax Appellate Tribunal is a fact finding Tribunal and if it arrives as its own conclusions of fact after due consideration of the evidence before it this court will not interfere. It is necessary, however, that every fact for and against the assessee must have been considered with due care and the Tribunal must have given its finding in a manner which would clearly indicate what were the questions which arose for determination, what wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would justify such an inference. No scientific data was before any of the Income Tax authorities from which it could be inferred that the normal yield of the oil should be 32% and of the oil cake 66% and that the allowable refraction should be 2%. Even there was no material on the record to show on what basis the predecessor of the Appellate Assistant Commissioner had applied the same rates in respect of the assessment for the immediately preceding year. There was no material to show what was the quality of the seeds used in the previous year. The Appellate Assistant Commissioner rejected the results of the subsequent year on the ground that there was no material to show that the seeds were of the same quality, but he has relied upon the rates fixed by his predecessor at the previous year without there being any material to show that the quality of the seeds in the year immediately preceding the assessment year was the same as that of the assessment year. The Appellate Tribunal has assumed that that was the rate prevalent in the locality for which there was no material. The Income Tax Officer has also not rejected the account books. The quantity of the seeds crushed as disclosed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the first place the Income Tax Officer has not rejected the account books of the petitioner. In the second place, he has not estimated the income of the assessee on the basis of the previous years assessment, but he has assumed the rate of yield from the oil seeds on a certain percentage. On the basis of the same percentage the yield was considered normal by his predecessor in the previous year. The percentage of yield may depend upon various factors such as the quality of the seeds and the condition of the machinery collected for crushing. In the absence of any material to show that the quality of the seeds in the previous year can be no material for ascertaining the actual yield in the year of assessment. Moreover, as I have already observed, the Appellate Assistant Commissioner has referred to the order of his predecessor. He has not referred at all to the assessment order of the Income Tax Officer for the year immediately preceding the year of assessment. Mr. Chaudhary contends that the entire file of assessment of the assessee for the previous year is placed before the Income Tax Officer at the time of making assessment and when the Appellate Assistant Commissioner refers ..... X X X X Extracts X X X X X X X X Extracts X X X X
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