ACIT 20(1), MUMBAI V. KHOPOLI POLYMER PRODUCTS, MUMBAI

ITA 1621/MUM/2011

• Counselvise Citation: 162119914 RSA 2011
• Duration Of Justice: 3 year(s) 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Next Hearing Date: 25-11-2014
• Assessment Year: 2005-2006
• Appeal Filed On: 25-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SACCHIDANAND DUBEY
• Keywords: Additional evidence
• Section: 145; 80IB; 133(6)

Judgement Text

, INCOME TAX APPELLATE TRIBUNAL,M UMBAI - I BENCH. , , BEFORE S/SH. RAJENDRA, ACCOUNTANT MEMB ER & VIVEK VARMA, JUDICIAL MEMBER /. ITA NO.1621/MUM/2011, ! ! ! ! ' ' ' ' / ASSESSMENT YEAR-2005-06 ACIT 20(1), PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI -400012 V/S. M/S KHOPOLI POLYMER PRODUCTS, D-702, SHERE PUNJAB COLONY, HILTON TOWER, ANDHERI (E), MUMBAI-400093. # # # # . . . /PAN:AADFK2433N ( #$ / APPELLANT) ( %&#$ / RESPONDENT) ' ( / REVENUE BY : SHRI SACCHIDANAND DUBEY !)* !)* !)* !)* ( ( ( ( / ASSESSEE BY : NONE ! ! ! ! ' '' ' *+ *+ *+ *+ / DATE OF HEARING : 25-11-2014 ,-' ' *+ / DATE OF PRONOUNCEMENT : 25-11-2014 ! ! ! ! , 1961 ' '' ' 254 )1 ( *.* *.* *.* *.* / / / / ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA,AM ! ! ! ! : CHALLENGING THE ORDER DATED 30.12.2010 OF THE CIT(A )-31,MUMBAI THE ASSESSING OFFICER (AO) HAS RAISED FOLLOWING GROUNDS OF APPEAL: L.THE LEARNED CIT(A) HAS ERRED ON FACTS AND IN LAW AND IN THE CIRCUMSTANCES OF THE CASE IN REJECTING THE ESTIMATED INCOME OF RS.16,65,512/- BE ING 5% OF TOTAL TURNOVER IN RESPECT OF MANUFACTURING ACTIVITIES AND SIMILARLY ESTIMATING T HE INCOME OF RS.27,39,320/- BEING 10% OF TOTAL TURNOVER IN RESPECT OF CONSTRUCTION ACTIVITIES MADE BY THE AO. 2.THE LEARNED CIT(A) HAS ERRED IN LAW AND IN THE CI RCUMSTANCES OF THE CASE IN ALLOWING THE CLAIM OF ASSESSEE U/S.80IB OF THE ACT STATING THAT THE AC TIVITY OF THE ASSESSEE CONSTITUTE MANUFACTURE OR PRODUCTION OF AN ARTICLE OR THING. 3.THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(APP EALS) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE AO BE RESTORED. 4.THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR TO SUBMIT ADDITIONAL NEW GROUND WHICH MAY BE NECESSARY. ASSESSEE-FIRM,ENGAGED IN THE BUSINESS OF DEALING AN D MANUFACTURING OF EMULSIONS AND CHEMICALS AND ROAD CONSTRUCTION,FILED ITS RETURN OF INCOME ON 29.10.2005 DECLARING A TOTAL INCOME OF RS. 15. 75 LAKHS.THE AO COMPLETED THE ASSESSMENT U/S.143(3) OF THE ACT,ON 26.12.2007,DETERMINING THE INCOME OF THE ASSESSEE AT RS. 79,23,830/-. 2. FIRST GROUND OF APPEAL IS ABOUT REJECTING THE BOOKS OF ACCOUNTS OF THE ASSESSEE AND ESTIMATING ITS INCOME.DURING THE ASSESSMENT PROCEEDINGS, THE AO FO UND THAT THE ASSESSEE WAS ENGAGED IN TWO TYPES OF BUSINESS I.E. MANUFACTURING AND ROAD CONST RUCTION,THAT IT HAD FILED CONSOLIDATED PROFIT AND LOSS ACCOUNT,THAT THE TURNOVER AND EXPENSES RELATAB LE TO BOTH THE BUSINESSES HAD BEEN CLAIMED UNDER COMMON HEADS,THAT IN THE COMPUTATION OF TOTAL INCOME IT HAD SHOWN PROFIT FROM MANUFACTURING ACTIVITY AT RS. 4.89 LAKHS ON A TURNO VER OF RS. 3.33 CRORES, THAT THE NET PROFIT ON ROAD CONSTRUCTION ACTIVITY WAS SHOWN AT RS. 11.73 L AKHS ON A TOTAL TURNOVER OF RS. 2.73 CRORES, THAT THE ASSESSEE HAD CLAIMED DEDUCTION U/S 80IB(3) (II) AT 25% OF THE TOTAL PROFITS AMOUNTING TO RS.1.22 LAKHS,THAT WATER WAS MAJOR COMPONENT OF THE FINAL PRODUCT MANUFACTURED BY THE ASSESSEE,THAT IT CONSTITUTED 40 TO 50% OF THE PRODU CT, THAT THE TAX AUDIT REPORT SHOWED THAT IT HAD CONSUMED 309110 KGS.OF RAW MATERIAL, THAT THE PRODU CTION WAS OF 58,62,34 KGS. HE HELD THAT THERE WAS AN EXCESS PRODUCTION OF 122569 KGS. THE A O FURTHER FOUND THAT THE METHOD OF VALUATION OF CLOSING STOCK WAS AT COST EXCLUDING CE N-VAT AND EXCISE DUTY,THAT THE ASSESSEE HAD 2 ITA NO. 1621/M/2011 M/S KHOPOLI PLOYMER PRODUCTS ADOPTED THE AVERAGE METHOD FOR VALUING THE CLOSING STOCK. HE HELD THAT IT WAS VIOLATION OF ACCOUNTING PRINCIPLES AND DEVIATION FROM THE PRESCR IBED ACCOUNTING STANDARDS WITHIN THE MEANING OF SECTION 145A OF THE ACT,THAT THE BOOKS RESULTS O F THE ASSESSEE WERE NOT RELIABLE.THE AO ALSO CALLED FOR INFORMATION FROM VARIOUS PARTIES WHO HAD DEALING WITH THE ASSESSEE.HE ISSUED NOTICES U/S 133(6) OF THE ACT.AS PER THE AO,21 PARTIES DID NOT RESPOND TO THE NOTICES.REJECTING THE BOOK RESULTS OF THE ASSESSEE, THE AO HELD THAT NET PROFI T IN RESPECT OF MANUFACTURING ACTIVITY WAS TO BE ESTIMATED AT RS. 16.65 LAKHS (5%). SIMILARLY,HE EST IMATED THE NET PROFIT ON CONSTRUCTION ACTIVITY WHICH 10% I.E. RS. 27.39 LAKHS. 3. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE PREF ERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA). BEFORE HIM IT WAS ARGUED THAT FINDI NGS OF THE AO WERE NOT BASED ON FACTS AND EVIDENCES,THAT THE ASSESSEE HAD EXPLAINED WATER WAS MAJOR COMPONENT OF FINAL PRODUCT AND CONSTITUTED 40 TO 50% OF THE PRODUCT. THE ASSESSEE SUBMITTED THE FOLLOWING PARTICULARS BEFORE THE FAA. PARTICULARS QUANTITY IN KGS. PERCENTAGE (%) OPENING STOCK 32.674.87 ADD : PURCHASES 3,37,708.10 LESS : CLOSING STOCK 54,797.91 LESS : SALES OF RAW MATERIAL 6475.00 CONSUMPTION OF PRODUCTION 3,09,110.06 52.73% WATER COMPONENT IN PRODUCTION 2,77,123.44 47.27% PRODUCTION 5,86,233.50 100% IT WAS ARGUED THAT THE WATER COMPONENT WAS 47.27% O F THE PRODUCTION OF PRODUCE AND SAME WAS WITHIN THE PARAMETERS OF 40 TO 50% OF THE PRODUCT, THAT THERE WAS NO DISCREPANCY IN CONSUMPTION AND PRODUCTION,THAT THERE WAS NO OUT OF BOOK PURCHA SES, THAT THE ASSESSEE HAD PREPARED BOOKS OF ACCOUNTS AS ACCOUNTING STANDARDS (AS)-2,THAT THE AO HAD NOT POINTED OUT ANY DISCREPANCY IN RESPECT OF ROAD CONSTRUCTION ACTIVITY, THAT HE HAD INVOKED THE PROVISIONS OF SECTION 145 R.W.S 144 AND HAD ESTIMATED THE INCOME @ 10% OF THE TURNOVER OF THE ROAD CONSTRUCTION ACTIVITY WITHOUT ANY BASIS. BEFORE HIM,THE ASSESSEE FILED CONFIRMATION OF THE P ARTIES TO WHOM THE ENQUIRY LETTERS U/S.133(6) OF THE ACT WERE ISSUED BY THE AO.AS THE PAPERS SUBMITT ED WERE IN FORM OF ADDITIONAL EVIDENCES SO HE CALLED FOR A REMAND REPORT FROM THE AO. AFTER CO NSIDERING THE SUBMISSION OF THE ASSESSEE,THE REMAND REPORT AND THE SUBMISSION MADE BY THE ASSESS EE IN RESPONSE TO THE REMAND REPORT, HE HELD THAT THE EXCESS PRODUCTION OF FINISHED GOODS WORKED OUT BY THE AO IN RESPECT OF MANUFACTURING ACTIVITY WAS WITHOUT ANY BASIS, THAT NOTHING WAS BR OUGHT ON RECORD BY THE AO TO PROVE THE EXCESS PRODUCTION OF FINISHED GOODS,THAT THE BOOKS OF ACCO UNTS WERE DULY AUDITED, THAT IT HAD ALL THE DETAILS OF DAY TO DAY STOCK,THAT IT HAD TALLIED THE FIGURES OF PURCHASES, CONSUMPTION, PRODUCTION AND SALE,THAT THE ASSESSEE WAS MAINTAINING QUANTATI VE DETAILS OF THE PRODUCTION,THAT THE MANUFACTUR -ING BUSINESS OF THE ASSESSEE WAS COVERED UNDER CE NTRAL EXCISE, THAT IT HAD MAINTAINED ALL THE NECESSARY RECORDS,THAT NOTHING ADVERSE OR CONTRARY EVIDENCE WERE BROUGHT ON RECORD BY THE AO TO HOLD THAT THE PRODUCTION OF THE FINISHED GOODS DISC LOSED BY THE ASSESSEE WAS INCORRECT OR WRONG. HE FURTHER HELD THAT NON-SERVICES OF NOTICES ISSUED U/S 133(6) OF THE ACT HAS TO BE ANALYSED PROPERLY. HE HELD THAT THE AO HAD FAILED TO CARRY O UT FURTHER ENQUIRIES/INVESTIGATION, SO AS TO ESTABLISH HIS FINDINGS, THAT THE AO WAS NOT JUSTIFI ED IN REJECTING THE BOOKS OF ACCOUNTS OF THE ASSESSEE BY INVOKING THE PROVISIONS OF SECTION 145( 3) OF THE ACT,THAT THE SUBMISSIONS FILED BY THE IT DURING THE APPELLATE PROCEEDINGS WERE PROVIDED T O THE AO FOR OFFERING HIS COMMENTS/ OBJECTIONS, THAT THE AO DID NOT CARRY OUT ANY ENQUI RY,THAT ALL THE PURCHASES MADE WERE DULY SUPPORTED BY THE INVOICES ISSUED BY THE CONCERNED P ARTIES, THAT THE SAME WERE DULY RECORDED IN THE BOOKS OF ACCOUNTS,THAT THE CONSUMPTION/PRODUCTION/S ALE OF THE RAW MATERIALS/FINISHED GOODS AS PER THE QUANTITATIVE RECORDS MAINTAINED BY THE ASSE SSEE WERE NOT DISAPPROVED OR HELD INCORRECT BY THE AO,THAT THE PAYMENTS AGAINST THE PURCHASES WERE MADE TO REGULAR BANKING CHANNELS, THAT THE BOOKS OF ACCOUNTS WERE DULY AUDITED AS REQUIRED U/S 144AB OF THE ACT, THAT NO DISCREPANCIES WERE 3 ITA NO. 1621/M/2011 M/S KHOPOLI PLOYMER PRODUCTS POINTED OUT IN THE AUDIT REPORT,THAT THE AO HAD EST IMATED THE NET PROFIT WITH REGARD TO CONSTRUCTION ACTIVITY AND MANUFACTURING ACTIVITY WITHOUT ANY BAS IS,THAT THERE WAS NO EVIDENCES TO ESTABLISH THAT IT HAD SHOWN LESSER PROFIT IN RESPECT OF MANUFACTUR ING AND PRODUCTION ACTIVITY. 4. BEFORE US,NO ONE APPEARED ON BEHALF OF THE ASSESSEE .DEPARTMENTAL REPRESENTATIVE (DR) SUPPORTED THE ORDER OF THE AO.WE HAVE PERUSED THE M ATERIAL BEFORE US.UNDISPUTED FACTS OF THE CASE ARE THAT THE ASSESSEE WAS ENGAGED IN TWO BUSIN ESS ACTIVITIES DURING THE YEAR UNDER CONSIDERATI -ON,THAT THE AO HAD REJECTED THE RESULTS OF BOOKS O F ACCOUNTS AND ESTIMATED THE PROFIT OF THE MANUFACTURING ACTIVITY AT RS. ,THAT HE HAD MADE SOM E INQUIRIES AT THE TIME OF ASSESSMENT IN THAT REGARD.BUT,WE FIND THAT HE DID NOT MAKE ANY INQUIRY ABOUT THE ROAD CONSTRUCTION ACTIVITIES OF THE ASSESSEE AND EVEN THEN MADE AN ADDITION OF RS. .HE HAS NOT GIVEN ANY REASON FOR ENHANCING THE INCOME OF THE ASSESSEE UNDER THE HEAD INCOME FROM R OAD CONSTRUCTION ACTIVITY. AS PER THE ESTABLISHED PRINCIPLES OF TAXATION JURISPRUDENCE TH E THE PRINCIPLES TO BE FOLLOWED WHEN A BEST JUDGMENT ASSESSMENT IS UNDERTAKEN BY AN AO ARE THAT THE POWER TO LEVY ASSESSMENT ON THE BASIS OF BEST JUDGMENT IS NOT AN ARBITRARY POWER-IT IS AN ASSESSMENT ON THE BASIS OF BEST JUDGMENT OF THE OFFICER.SECONDLY, WHEN BEST JUDGMENT ASSESSMENT IS UNDERTAKEN IT CANNOT BE AS PER THE WHIMS AND FANCIES OF THE AO,BUT SHOULD BE BASED ON SOME MATER IAL EITHER PRODUCED BY THE ASSESSEE OR GATHERED BY HIM.THIRDLY,IF FOR ANY REASON MATERIAL LIKE BOOKS OF ACCOUNT PRODUCED BY THE ASSESSEE IS REJECTED AS UNRELIABLE OR UNSATISFACTORY,THERE S HOULD BE VALID REASONS FOR DOING SO.WE FIND THAT IN THE CASE UNDER CONSIDERATION NONE OF THE ABOVE M ENTIONED BASIC PRINCIPLES HAVE BEEN FOLLOWED BY THE AO.THERE IS NOTHING IN THE ORDER OF THE AO A S TO WHY HE IS REJECTING THE RESULTS OF ROAD CONSTRUCTION ACTIVITIES.NOW,WE WOULD TAKE UP THE IS SUE OF MANUFACTURING ACTIVITIES. IT IS A FACT THAT THE AO HAD MADE SOME INQUIRIES BY ISSUING NOTICES U /S.133(6) OF THE ACT,BUT IT IS ALSO A FACT THAT DURING THE REMAND PROCEEDINGS THE AO HAD NOT MADE A NY INQUIRY ABOUT THE CONFIRMATIONS FILED BY THE ASSESSEE.THE FAA HAS GIVEN HIM A CHANCE TO SUBS TANTIATE HIS STAND,BUT HE DID NOT AVAIL IT.IT IS ALSO A FACT THAT THE BOOKS OF ACCOUNTS ARE AUDITED AND THE AO HAS NOT POINTED OUT ANY MISTAKE IN THE QUANTATIVE DETAILS MAINTAINED BY THE ASSESSEE.I T IS SAID THAT IF THE ACCOUNTS WHICH ARE REGULARLY MAINTAINED IN THE COURSE OF BUSINESS AND ARE DULY A UDITED, FREE FROM ANY QUALIFICATION BY THE AUDITORS,THEY SHOULD NORMALLY BE TAKEN AS CORRECT U NLESS THERE ARE ADEQUATE REASONS TO INDICATE THAT THEY ARE INCORRECT OR UNRELIABLE.IN SUCH MATTERS,TH E ONUS IS UPON THE AO TO SHOW THAT EITHER THE BOOKS OF ACCOUNT MAINTAINED BY THE ASSESSEE WERE IN CORRECT OR INCOMPLETE OR THAT THE METHOD OF ACCOUNTING ADOPTED BY HIM WAS SUCH THAT TRUE PROFIT S OF THE ASSESSEE CANNOT BE DEDUCED THERE - FROM.WE FIND THAT THE AO HAS DONE OF THE TWO THINGS .IT WAS THE FAILURE ON PART OF THE AO THAT THE FAA HAD TO HOLD THAT THE ESTIMATED ADDITIONS ON BOT H THE COUNTS-MANUFACTURING AND ROAD CONSTRUCTION-WERE WITHOUT ANY BASIS.IN OUR OPINION, THE ORDER OF THE FAA DOES NOT SUFFER FROM ANY LEGAL OR FACTUAL INFIRMITY.THEREFORE,CONFIRMING HIS ORDER WE DECIDE GROUND NO.1 AGAINST THE AO. 5. NEXT GROUND OF APPEAL IS ABOUT CLAIM MADE U/S.80IB OF THE ACT.DURING THE ASSESSMENT PROCEEDINGS,THE AO FOUND THAT THE ASSESSEE WAS MANU FACTURING WATER BASE POLYMER EMULSIONS.HE HELD THAT WHEN THE CHANGE OR SERIES OF CHANGES WOUL D TAKE PLACE WITH REGARD TO PROCESS OF A THING THE ACTIVITY WAS TO BE CONSIDERED AS MANUFACTURING, THAT THE ASSESSEE WAS BUYING DIFFERENT TYPE OF RAW MATERIALS IN A FIXED CONCENTRATES AND COLOURS FROM THE MARKET, THAT IT WAS MIXING THE RAW MATERIAL IN DIFFERENT PROPORTIONE,THAT IT WAS PACKI NG THEM IN A DESIRED QUANTITY AND SELLING SUCH PREMIXED MATERIALS,THAT THE ACTIVITY UNDERTAKEN BY THE ASSESSEE COULD UTMOST BE REGARDED PROCESSING BUT NOT MANUFACTURING/PRODUCTION OF AN A RTICLE OR A THING, THAT THE INPUT AND OUTPUT REMAINED THE SAME,THAT NO COMMERCIALLY NEW AND DIST INCT COMMODITY CAME INTO EXISTENCE,THAT A FEW LABOURERS WERE ENGAGED BY THE ASSESSEE TO MIX T HE RAW MATERIAL,THAT ASSESSEE WAS NOT ENTITLED TO RELIEF U/S 80IB OF THE ACT. 6. AGGRIEVED BY THE ORDER OF THE AO,THE ASSESSEE PREFE RRED AN APPEAL BEFORE THE FAA.BEFORE HIM, IT WAS ARGUED THAT MANUFACTURING PROCESS INVOLVED V ARIOUS STAGES THROUGH WHICH THE RAW MATERIAL HAS TO UNDERGO,THAT THE ASSESSEE WAS RUNNING TWO SH IFTS OF 8 HOURS EACH WITH THE AID OF POWER,THAT THE MANUFACTURING PROCESS INVOLVED THE STANDARD DEL AYED EMULSIONS POLYMERIZATION, THAT VARIOUS 4 ITA NO. 1621/M/2011 M/S KHOPOLI PLOYMER PRODUCTS RAW MATERIALS WERE TAKEN IN THE REACTOR, THAT SAME WERE HEATED TO A PARTICULARS TEMPERATURE DEPENDING ON THE END APPLICANTION,THAT CATALYST WER E ADDED AS PER THE REQUIREMENT OF THE END PRODUCT,THAT PARTICULAR TEMPERATURE WAS MAINTAINED DURING COOLING PROCESS.IT WAS FURTHER STATED THAT THE RAW MATERIALS WERE FALLING UNDER CHAPTER 2 9 OF CENTRAL EXCISE WHEREAS THE FINISHED GOODS WERE PART CHAPTER 39 OF THE CENTRAL EXCISE MANUAL, THAT THE RAW MATERIAL AND FINISHED PRODUCTS KNOWN DIFFERENTLY IN COMMERCIAL PARLANCE. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE A ND THE ASSESSMENT ORDER,HE HELD THAT THE AO WAS NOT JUSTIFIED IN DENYING THE BENEFIT OF SECTION 80IB TO THE ASSESSEE, THAT FROM THE DETAILS OF PROCESSING OF RAW MATERIAL IT WAS EVIDENT THAT FINA L PRODUCT WAS A RESULT OF STEPWISE MANUFACTURING PROCESS,THAT MANUFACTURING ACTIVITIES WERE CARRIED OUT BY THE ASSESSEE,THAT NEW SET OF PRODUCT WITH NEW PROPERTIES WERE COMING INTO EXISTENCE,THAT THE CENTRAL EXCISE DEPARTMENT HAD ACCEPTED THE DIFFERENCE OF RAW MATERIAL AND FINISHED GOODS.FINAL LY,HE ALLOWED THE APPEAL FILED BY THE ASSESSEE. 7. BEFORE US,THE DR SUPPORTED THE ORDER OF THE AO.WE H AVE PERUSED THE MATERIAL BEFORE US.COURTS ARE OF THE VIEW THAT IF ANY PRODUCT IS COMMERCIALLY SALABLE AS A DIFFERENT PRODUCT FROM ITS ORIGINAL INGREDIENTS IT HAS TO TAKEN AS A NEW PRODUCT AND TH E ASSESSEE HAS TO BE ALLOWED SPECIAL DEDUCTION FOR MANUFACTURING IT.IN THE CASE OF VINBROS AND CO. (349ITR697) THE HONBLE APEX COURT HAS HELD THAT IF ANY PROCESS BRINGS ABOUT A SALEABLE COMMODI TY TOTALLY DIFFERENT FROM THE ORIGINAL THEN THE ASSESSEE ENTITLED TO CLAIM DEDUCTION UNDER SECTION 80-IB OF THE ACT.IN THAT MATTER THE ISSUE BEFORE THE HONBLE COURT WAS AS TO WHETHER BLENDING OF REC TIFIED SPIRIT OR EXTRA NEUTRAL ALCOHOL TO CONVERT IT IN TO VARIOUS LIQUORS WAS A MANUFACTURING ACTIVI TY OR NOT.THE HONBLE COURT DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE.WE FIND THAT THE ASSESSEE IS ENGAGED IN MANUFACTURING OF EMULSIONS AND CHEMICALS.THE FAA,HAS AFTER ANALYSING THE WHOLE PRO CESS UNDERTAKEN BY THE ASSESSEE,HELD THAT THE THE ACTIVITIES OF THE ASSESSEE AMOUNTED TO MANUFACT URING.WE FIND THAT THE ASSESSEE IS NOT ONLY MIXING THE RAW MATERIAL,IT HAS TO TAKE MANY A STEPS TO GET THE END RESULT.POLYMERISATION IS A COMPLEX PROCESS AND THE END PRODUCT IS TOTALLY DIFF ERENT FROM THE RAW MATERIAL.EVEN THE EXCISE DEPARTMENT HAS RECOGNISED THE DIFFERENCE IN THE RAW MATERIAL AND FINISHED GOODS.IN THESE CIRCUMSTANCES,WE ARE OF THE OPINION THAT THE ORDER OF THE FAA IS NOT SUFFERING FROM ANY LEGAL INFIRMITY.SO,ENDORSING HIS ORDER WE DECIDE GROUND N O.2 AGAINST THE AO. AS A RESULT,THE APPEAL FILED BY THE AO STANDS DISMI SSED. 1*2 !)* + 3 4 !5 ' * 67 . ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH ,NOVEMBER 2014 . / ' ,-' 8 9! 25 TH ! , 201 4 - ' . : SD/- SD/- ( / VIVEK VARMA) ( / RAJENDRA) / JUDICIAL MEMBER /ACCOUNTANT MEMBER / MUMBAI, 9! /DATE: 25.11 . 2014. / / / / ' '' ' %* %* %* %* ; '* ; '* ; '* ; '* / COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE / #$ 2. RESPONDENT / %&#$ 3. THE CONCERNED CIT(A)/ < = , 4. THE CONCERNED CIT / < = 5. DR I BENCH, ITAT, MUMBAI / >. %*! , . . . 6. GUARD FILE/ . 1 & * & * & * & * %* %*%* %* //TRUE COPY// /! / BY ORDER, ? / 6 DY./ASST. REGISTRAR , /ITAT, MUMBAI