M/s. Vega Jewellery, Mumbai V. The ACIT.,Navsari Circle, Navsari

ITA 2874/AHD/2015

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 9402 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 16-01-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 13-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P S CHAUDHARY
• Section: 143(3); 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD SMC BENCH AHMEDABAD BEFORE SHRI S.S. GODARA, JM & SHRI MANISH BORAD, AM. ITA NO. 2874/AHD/2015 ASST. YEAR: 2010-11 M/S VEGA JEWELLERY, 208-222, KOHINOOR INDUSTRIAL ESTATE, OPP. VIRVANI IND., EASTERN EXPRESS HIGHWAY, GOREGAON EAST, MUMBAI-64 VS. ASSTT. COMMISSIONER OF INCOME TAX, NAVSARI CIRCLE, NAVSARI APPELLANT RESPONDENT PAN AAEFV2026M APPELLANT BY MS. URVASHI SODHAN, AR RESPONDENT BY SHRI P.S. CHAUDHARY, SR.DR DATE OF HEARING: 16 /01/2017 DATE OF PRONOUNCEMENT: 19/01/2017 O R D E R PER MANISH BORAD, ACCOUNTANT MEMBER . THIS APPEAL OF ASSESSEE FOR ASST. YEAR 2010-11 IS DIRECTED AGAINST THE ORDER OF LD. CIT(A), VALSAD, DATED 18/0 8/2015 VIDE APPEAL NO.CIT(A)/VLS/83/13-14 ARISING OUT OF ORDER U/S 14 3(3) OF THE IT ACT, 1961 (HEREIN AFTER REFERRED AS ACT) FRAMED ON 20/03/2012 BY ACIT, NAVSARI CIRCLE, NAVSARI. ITA NO. 2874/AHD/2015 ASST. YEAR 2010-11 2 ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL :- (1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW THE HONORABLE CIT (A), VALSAD HAS ERRED IN CONFIRMING THE ADDITIO N MADE BY THE LD. A.O, OF RS, 14,26,826/-, CONSIDERING THE GENUINE MANUFACTURING LOSS CLAIMED OF 8.20% IN THE PROCESS OF MANUFACTURING OF HIGH CLASS DIAMOND STUD DED GOLD JEWELLERY AS PER THE SPECIFICATION OF THE CUSTOMERS, TO BE IN EXCESS OF ALLEGED NORMAL MANUFACTURING LOSS OF 1%. (2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW THE HONORABLE CIT (A), VALSAD HAS ERRED IN CONFIRMING THE ADDITIO N MADE BY THE LD. A.O. ADOPTING ARBITRARY PERCENTAGE OF 1% OF MANUFACTURING LOSS IN THE MANUFACTURING OF DIAMOND STUDDED JEWELLERY INDUSTRY WITHOUT CITING ANY COMPA RABLE INSTANCES AND WITHOUT REJECTING BOOK RESULTS AND WITHOUT POINTING OUT ANY DEFECT IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. (3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW THE HONORABLE CIT (A), VALSAD HAS ERRED IN CONFIRMING THE ADDITIO N MADE BY THE LD. A.O. WITHOUT CONSIDERING THE FACTS AND THE CASE LAWS FAVOURING T HE ASSESSEE PRODUCED DURING THE APPELLATE PROCEEDINGS. (4) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW THE HONORABLE CIT (A), VALSAD HAS ERRED IN CONFIRMING THE ADDITIO N MADE BY THE LD. A.O. ONLY ON THE GROUND THAT THE ABOVE ISSUE WAS MATTER OF APPEA L IN ASSESSEE'S OWN CASE IN A.Y. 2007-08 AND A.Y. 2009-10 AND THE APPEAL WAS DECIDED AGAINST THE APPELLANT BY THEIR HONR'BLE PREDECESSORS, OVERLOOKING THE FACTS PRODUC ED FOR THE YEAR UNDER CONSIDERATION, WHICH DIFFER THAN THE PREVIOUS YEARS . (5) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW THE ADDITION SATED ABOVE DESERVES TO BE DELETED, HENCE, IT IS PR AYED TO YOUR HONOUR TO DELETE THE SAME AND DO THE JUSTICE. (6) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR VAR Y ANY OF THE GROUNDS OF APPEAL. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE AS SESSEE IS A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF MANUFAC TURING DIAMONDS STUDDED JEWELLERY. E-RETURN OF INCOME DECLARING TOT AL INCOME OF RS.24,65,678/- WAS FILED ON 23/09/2010. CASE WAS SE LECTED FOR SCRUTINY AND NOTICE U/S. 143(2) OF THE ACT FOLLOWE D BY 142(1) OF THE I.T ACT ALONG WITH QUESTIONNAIRE WAS SERVED UPON ASSESS EE. ITA NO. 2874/AHD/2015 ASST. YEAR 2010-11 3 3. NECESSARY INFORMATION WERE CALLED FOR DURING COU RSE OF ASSESSMENT PROCEEDING. LEARNED ASSESSING OFFICER O BSERVED THAT ASSESSEE HAS SHOWN MANUFACTURING LOSS IN DIAMOND ST UDDED 18 CARAT GOLD ORNAMENTS AT THE RATE OF 8.2% WHICH IN THE VIE W OF LEARNED ASSESSING OFFICER (IN SHORT LD. AO) WAS ABNORMALLY HIGH AS COMPARED TO MANUFACTURING LOSS IN SUCH TYPE OF IND USTRY RANGING BETWEEN 0.5% TO 1%. ACCORDINGLY LD. AO CALCULATED DISALLOWANCE AT RS.14,26,823/- BY APPLYING MANUFACTURING LOSS AT TH E RATE OF 1%. 4. AGGRIEVED ASSESSEE WENT IN APPEAL BEFORE LD. CIT (A) BUT COULD NOT SUCCEED AS LD. CIT(A) FOLLOWED THE DECISION OF HIS PREDECESSOR FOR A.Y. 2007-08 AND 2009-10 IN THE CASE OF ASSESSE E. 5. ASSESSEE IS NOW IN APPEAL BEFORE THE TRIBUNAL. 6. AT THE OUTSET LD.AR SUBMITTED THAT ISSUE IN THIS APPEAL IS SQUARELY COVERED BY THE ORDER OF THE CO-ORDINATE BE NCH IN ITA NO.1604/AHD/2011 AND OTHERS FOR A.Y. 2007-08 AND 20 09-2010 DECIDED IN FAVOUR OF ASSESSEE. 7. LD.DR VEHEMENTLY ARGUE AND SUPPORTED ORDER OF LO WER AUTHORITIES. 8. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL PLACED ON RECORDS AND GONE THROUGH THE DECISION OF CO-ORDINATE BENCH REFERRED AND RELIED BY THE AR. THOUGH ASSESSE E HAS RAISED FOUR GROUNDS OF APPEAL BUT THE SOLITARY GRIEVANCE REVOLVES ROUNDS THE DISALLOWANCE OF RS.14,26,826/- ON ACCOUNT OF EXCESS MANUFACTURING LOSS CALCULATED BY LD. AO BY APPLYING RATE OF 1% A S AGAINST 8.2% ITA NO. 2874/AHD/2015 ASST. YEAR 2010-11 4 DISCLOSED BY ASSESSEE IN RELATION TO MANUFACTURING OF DIAMONDS 18K GOLD JEWELLERY. 9. WE OBSERVE THAT SIMILAR ISSUE AND IDENTICAL FACT S CAME UP BEFORE THE CO-ORDINATE BENCH IN ASSESSEES OWN CA SE IN A.Y. 2007-08 AND 2009-10 IN ITA NO.1604/AHD/2011 AN D OTHER (SUPRA) WHEREIN CO-ORDINATE BENCH DELETED IMPUGNED DISALLOWANCE ON ACCOUNT OF MANUFACTURING LOSS BY OBSERVING AS F OLLOWS:- 8. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. SOLITARY ISSUE IN THIS APPEAL IS AGAINST THE DISALL OWANCE OF RS.45,08,042/- SUSTAINED BY LD. CIT(A). 9. DURING THE COURSE OF ASSESSMENT PROCEEDINGS ALL QUANTITATIVE DETAILS, RELATING TO PURCHASE, SALE, STOCK IN HAND, IN RELAT ION TO RAW MATERIAL AND FINISHED GOODS WERE PRODUCED BEFORE THE ASSESSING AUTHORITY AND NO ERROR HAS BEEN POINTED OUT IN THE AUDITED QUANTITATIVE RECORDS WHI CH HAVE BEEN REGULARLY MAINTAINED BY THE ASSESSEE SINCE LAST MANY YEARS AN D THE ONLY REASON GENERATED IN THE MIND OF ASSESSING OFFICER THAT IN THE NORMAL COURSE OF MANUFACTURING PROCESS RELATING TO GOLD ORNAMENTS, SHORTAGE LOSS A S PER HIS EXPERIENCE IS AROUND 1% WHEREAS ASSESSEE HAS CLAIMED 10.59% OF SHORTAGE LOSS. APART FROM THIS OBSERVATION THERE IS NO OTHER FINDING PLACED ON REC ORD. 10. WE ALSO FIND THAT IN THE HANDBOOK OF PROCEDURES (VOL.I) 1ST SEPTEMBER 2004 31ST MARCH, 2009 ISSUED BY MINISTRY OF COMM ERCE AND INDUSTRY, DEPARTMENT OF COMMERCE, GOVERNMENT OF INDIA WHEREIN WASTAGE NORMS HAVE BEEN GIVEN IN COLUMN 4A-2 WHICH READS THE WASTAG E OR MANUFACTURING LOSS ON GOLD/SILVER/PLATINUM JEWELLERY ARTICLES THEREOF IS NORMALLY AROUND 9%. FROM GOING THROUGH THE MANUFACTURING PROCESS SUBMITTED B Y THE ASSESSEE WE FIND THAT IT IS ALSO INVOLVED IN THE MANUFACTURING OF GOLD STUDD ED JEWELLERY 18 KT. AND THE MANUFACTURING LOSS SHOWN BY ASSESSEE IS AT 10.59% W HICH SHOWS THAT THERE IS NO MAJOR VARIATION BETWEEN THE WASTAGE NORMS OF 9% DEP ICTED BY THE HANDBOOK OF PROCEDURES (VOL.I) 1ST SEPTEMBER 2004 31ST MARCH, 2009 ISSUED BY MINISTRY OF COMMERCE AND INDUSTRY, DEPARTMENT OF COMMERCE, GOVE RNMENT OF INDIA AND LOSS OF 10.59% CLAIMED BY ASSESSEE. WE FURTHER OBSERVE T HAT ASSESSEE HAS SHOWN 9% SHORTAGE MANUFACTURING LOSS FOR ASST. YEAR 2005-06 AND 11.05% FOR ASST. YEAR 2006-07 DURING WHICH TURNOVER OF THE ASSESSEE RAISE D FROM 4.04 CR. TO 8.04 CR. AND ASSESSMENT WAS COMPLETED U/S 143(3) OF THE ACT FOR BOTH THE YEARS ON 30.11.2005 AND 5.12.2008 AND THE SHORTAGE LOSS IN M ANUFACTURING PROCESS SHOWN BY ASSESSEE AT 9% AND 11.05% ACCEPTED BY THE REVENU E. THIS FACT REVEALS THAT ITA NO. 2874/AHD/2015 ASST. YEAR 2010-11 5 ASSESSEE HAS BEEN CONSISTENTLY SHOWING SHORTAGE LOS S IN MANUFACTURING PROCESS IN BETWEEN 9 11% SINCE LAST MANY YEARS AND IN THE PR ECEDING YEAR NO ADDITION HAS BEEN MADE ON THIS ACCOUNT AND IN THE YEAR UNDER APP EAL NO SPECIFIC DEFECT IN THE BOOKS OF ACCOUNT HAS BEEN REVEALED BY THE ASSESSING OFFICER INCLUDING THE QUANTITATIVE DETAILS. 11. WE ALSO FIND THAT CO-ORDINATE BENCH, MUMBAI IN THE CASE OF SHUKRA JEWELLERY LTD. VS. ACIT (SUPRA) HAS DEALT WITH SIMI LAR ISSUE WHEREIN ASSESSEES CLAIM FOR LOSS OF 16.7% WAS DISALLOWED WITHOUT ASSI GNING ANY REASON AND THEREAFTER 1% GROSS PROFIT ON TOTAL TURNOVER HAD BE EN ADOPTED AGAIN WITHOUT ASSIGNING ANY REASON SINCE ASSESSEE HAD FILED EVERY DETAIL OF PURCHASE AND SALE. THE CO-ORDINATE BENCH ALLOWED THE APPEAL OF ASSESSE E BY OBSERVING AS UNDER :- 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CONSIDE RED THEM CAREFULLY. AFTER CONSIDERING THE SUBMISSIONS AND PERUSING THE MATERIAL ON RECORD, WE FIND THAT THE ASSESSEE DESERVES TO SUCCEED IN ITS APPEAL . IT IS NOTED THAT THE ASSESSMENT FOR ASST. YR. 2002-03 WAS COMPLETED UNDER S. 143(3) , IN ASST. YR. 2002-03, THE ASSESSEE SHOWN LOSS OF 21.75 PER CENT AND THE SAME HAS BEEN ACCEPTED BY THE AO. THE ASSESSMENT ORDER FOR ASST. YR. 2002-03 IS PLACE D AT P. 91 OF THE PAPER BOOKS. IT IS SEEN THAT NET LOSS OF RS. 5.54 CRORES WAS ACCEPT ED BY THE AO. THE METHOD OF ACCOUNTING ADOPTED BY THE ASSESSEE IS THE SAME METH OD OF ACCOUNTING ADOPTED IN EARLIER YEAR. EACH AND EVERY PURCHASE IS VOUCHED. N OT A SINGLE PURCHASE FOUND TO BE INCORRECT OR UNVERIFIABLE. THE AO ISSUED NOTICES TO THE TWO MAIN PARTIES AND BOTH PARTIES HAVE RESPONDED BY GIVING CONFIRMATIONS THAT THE HAVE MADE SALES TO THE ASSESSEE AS SHOWN IN THE PURCHASE ORDER AS PLAC ED ON RECORD. NO DISCREPANCY WHATSOEVER HAS BEEN POINTED OUT IN THE BOOKS OF ACC OUNT OR PURCHASE OR SALE VOUCHERS. PAYMENTS HAVE BEEN MADE THROUGH PROPER BA NKING CHANNELS. IT IS NOT THE CASE OF THE DEPARTMENT THAT THE ASSESSEE IS SHO WING PURCHASE ON HIGHER RATES AND SELLING THE SAME ON LESSER RATE TO REDUCE THE P ROFIT. THERE ARE HEAVY LOSSES SUFFERED BY THE ASSESSEE IN EARLIER YEAR. THE LOSSE S HAVE BEEN SHOWN ON ACCOUNT OF VALUATION OF CLOSING STOCK ON THE BASIS OF MARKET P RICE OR PURCHASE PRICE. THEREFORE, IT CANNOT BE SAID THAT THE ASSESSEE HAD SHOWN LOSS MALA FIDELY. IT IS FURTHER SEEN -THAT THE CLOSING STOCK PREPARED BY TH E ASSESSEE FOR IMMEDIATELY PRECEDING YEAR HAS BEEN ACCEPTED BY THE AC WITHOUT COMMENTING AN\ DEFECTS. THE BOOKS OL ACCOUNT WERE MAINTAINED IN THE REGULAR COU RSE OT BUSINESS AND THEY HAVE BEEN ACCEPTED BY THE AO. IT WAS FURTHER STATED THAT EVEN IN SUBSEQUENT ASSESSMENT YEAR I.E., 2004-05 THE OPENING STOCK WHICH WAS OF T HE CLOSING STOCK OF THE YEAR UNDER CONSIDERATION HAS BEEN ACCEPTED BY THE DEPART MENT, THEREFORE, FOR THIS REASON, REJECTION OF THE CLOSING AS WELL AS OPENING STOCK BY THE AO, IN OUR CONSIDERED VIEW IS NOT JUSTIFIED AT ALL. THE AO CAN NOT GO INTO THE FACTS OF THE IMMEDIATELY PRECEDING YEAR. THE ASSESSEE HAS EXPLAI NED THE CLOSING STOCK OF THE IMMEDIATELY PRECEDING YEAR, THE ASSESSMENT OF WHICH HAS ALSO BEEN COMPLETED UNDER S. 143(3). THEREFORE, CLOSING STOCK OF THE IM MEDIATELY PRECEDING YEAR HAS TO BE TAKEN INTO CONSIDERATION. IT HAS BEEN CATEGORICA LLY STATED THAT IN VIEW OF CONSISTENT METHOD OF VALUATION, LOSS IS INCURRED ON ACCOUNT OF VALUATION OF CLOSING STOCK ONLY. NEITHER THE VALUATION OF THE CURRENT YE AR WAS EXAMINED BY THE AO NOR ITA NO. 2874/AHD/2015 ASST. YEAR 2010-11 6 ANY OTHER MATERIAL WAS BROUGHT ON RECORD TO ESTABLI SH THAT VALUATION DONE BY THE ASSESSEE IS NOT PROPER. THE VALUATION HAS BEEN DONE CONTINUOUSLY ON THE BASIS OF MARKET PRICE OR PURCHASE PRICE WHICH IS LOWER AND A S PER ACCEPTED METHOD. RELIANCE HAS BEEN PLACED BY THE AO ON THE DECISION OF SAMIR DIAMONDS EXPON (SUPRA). HOWEVER, AS STATED ABOVE, EACH CASE HAS IT S OWN FACTS AND EACH BUSINESSMAN HAS ITS OWN WAY OF DOING BUSINESS. THER E MAY BE PROFIT IN SOME ITEMS AND THERE MAY BE LOSS IN SOME OTHER ITEMS. VA RIOUS REASONS HAVE BEEN EXPLAINED BEFORE THE AO. HOWEVER, THE AO DID NOT AC CEPT THE CONTENTIONS OF THE ASSESSEE. BY MERELY SAVING THAT THE EXPLANATION IS NOT ACCEPTABLE AND WITHOUT BRINGING ANY OTHER MATERIAL, IN OUR CONSIDERED VIEW , THE REJECTION OF BOOKS OF ACCOUNT WAS NOT JUSTIFIED AT THE END OF THE AUTHORI TIES BELOW. 6.1 WE HAVE ALSO NOTED THAT THERE WAS A LOSS IN TRA DING ACTIVITY FOR ASST. YR. 2001-02 ALSO AND THE ASSESSMENT FOR THAT YEAR WAS C OMPUTED UNDER S. 143(3). BOOKS OF ACCOUNTS HAVE BEEN ACCEPTED FOR THAT YEAR ALSO. COPY OF THE ORDER FOR ASST. YR. 2001-02 IS PLACED AT PP. 83 TO 86 OF THE PAPER BOOK. 6.2 WE HAVE FURTHER NOTED THAT EACH AND EVERY DETAI L AS REQUIRED BY THE AO WAS FILED FROM TIME TO TIME. THERE IS NOT A SING LE INSTANCE THAT THE ASSESSEE HAS NOT FILED THE DETAILS AS PER REQUIREMENT OF THE AO. COPIES OF THE LETTER ALONG WITH RETURN ARE PLACED AT PP. 31 TO 64 OF THE PAPER BOOK. ITEM-WISE PURCHASES AND ITEMS-WISE SALES ALONG WITH MONTH-WISE OPENING STOC K AND PURCHASE AND SALE HAVE BEEN FILED. THE AO DREW AN INFERENCE AGAINST THE AS SESSEE THAT THE TWO PARTIES OUT OF 4 PARTIES TO WHOM SUMMONS WAS ISSUED HAVE NOT CO MPLIED WITH THE SUMMONS ISSUED UNDER S. 131. THERE MAY BE SO MANY REASONS I N NOT RECEIVING OR COMPLYING WITH THE NOTICES. THERE MAY BE CHANGES OF ADDRESS A LSO. THE ASSESSEE HAS DISCHARGED ITS BURDEN FOR FILING THE DETAILS OF PUR CHASE FROM THOSE PARTIES AND HAS GIVEN THEIR COMPLETE ADDRESSES AVAILABLE WITH THE A SSESSEE. IF BY ANY REASON, THE TWO PARTIES FROM WHOM SIMILAR PURCHASES WERE MADE C OULD NOT APPEAR BEFORE THE AO, THE ASSESSEE CANNOT BE HELD FAULTY AND NO INFER ENCE SHOULD HAVE BEEN DAWN AGAINST THE ASSESSEE. THEREFORE, KEEPING IN VIEW OF THESE FACTS AND CIRCUMSTANCES AND KEEPING IN VIEW OF VOLUMINOUS DETAILS REQUIRED BY THE AO FILED BEFORE HIM, WE FIND THAT THE AO AND THE GIT (A) WERE NOT JUSTIFIED IN REJECTING THE CLAIM OF THE ASSESSEE. THE AO AS WELL AS CIT(A) HAVE REJECTED TH E LOSS CLAIMED BY THE ASSESSEE AT 16.70 PER CENT. THE ENTIRE LOSS HAS BEEN DISALLO WED WITHOUT ASSIGNING ANY REASON AND THEREAFTER, 1 PER CENT GROSS PROFIT ON T HE TOTAL TURNOVER HAS BEEN ADOPTED AGAIN WITHOUT ASSIGNING ANY REASON, THEREFO RE, AS STATED ABOVE, BOTH THE AUTHORITIES WERE NOT JUSTIFIED IN REJECTING THE BOO KS OF ACCOUNT AND NOT ALLOWING CLAIM OF LOSS OF THE ASSESSEE. ACCORDINGLY, WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND THE AO IS DIRECTED TO ALLOW T HE CLAIM OF THE ASSESSEE AS CLAIMED. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED. 12. THE FACTS OF THE CASE DISCUSSED IN THE DECISION OF CO-ORDINATE BENCH IN THE CASE OF SHUKRA JEWELLERY LTD. VS. ACIT (SUPRA) ARE ALSO SIMILAR TO THE FACTS OF THE CASE WE ARE DEALING IN. WE, THEREFORE, RESPECTFULLY FOLLOWING THE DECISION OF THE ITA NO. 2874/AHD/2015 ASST. YEAR 2010-11 7 CO-ORDINATE BENCH REFERRED ABOVE AND ALSO ON THE BA SIS OF OUR DISCUSSION MADE ABOVE, INCLUDING WASTAGE NORMS SET BY THE HANDBOOK OF PROCEDURES (VOL.I) 1ST SEPTEMBER 2004 31ST MARCH, 2009 ISSUED BY MINIST RY OF COMMERCE AND INDUSTRY, DEPARTMENT OF COMMERCE, GOVERNMENT OF IND IA AND ALSO FOLLOWING CONSISTENT PRINCIPLE OF MANUFACTURING PROCESS BY TH E ASSESSEE DULY SUPPORTED BY AUDITED FINANCIAL STATEMENTS AND COMPLETE QUANTITAT IVE RECORDS, WE ARE OF THE VIEW THAT NO DISALLOWANCE IS CALLED FOR IN MANUFACTURING LOSS AT RS.45,08,042/-. WE DELETE THE SAME. ACCORDINGLY THE APPEAL OF ASSESSEE IS ALLOWED. 10. WE OBSERVE THAT FACTS OF THE APPEAL BEFORE US F OR A.Y. 2010-11 ARE SIMILAR TO THOSE FOR A.Y. 2007-08 AS ADJUDICATE D BY THE CO-ORDINATE BENCH REFERRED ABOVE. 11. RESPECTFULLY, FOLLOWING THE DECISION OF CO-ORDI NATE BENCH WE OBSERVE THAT SIMILAR TYPE OF MANUFACTURING PROCESS IS CARRIED OUT BY ASSESSEE WHICH IS DULY SUPPORTED BY AUDITED FINANCI AL STATEMENT PROPER QUANTITATIVE RECORDS AND SIMILAR WASTAGE NOR MS AS DISCUSSED BY THE CO-ORDINATE BENCH WITH REFERENCE TO THE HAND BOOK OF PROCEDURES ISSUED BY MINISTRY OF COMMERCE AND INDUS TRY, DEPARTMENT OF COMMERCE, GOVERNMENT OF INDIA. 12. WE ARE THEREFORE OF THE VIEW THAT NO DISALLOWAN CE IS CALLED FOR TOWARDS MANUFACTURING LOSS OF RS.14,26,826/- 13. WE DELETE THE SAME. ACCORDINGLY APPEAL OF THE A SSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 JANUAR Y, 2017 SD/- SD/- (S.S. GODARA) JUDICIAL MEMBER (MANISH BORAD) ACCOUNTANT MEMBER TRUE COPY DATED 19 /01/2017 MANISH/- ITA NO. 2874/AHD/2015 ASST. YEAR 2010-11 8 COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER ASST. REGISTRAR, ITAT, AHMEDABAD 1. DATE OF DICTATION: 18/12/2016 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE 12/2016 OTHER MEMBER: AFT COMES TO THE SR. P. S./P.S.: