COMMISSIONER OF INCOME TAX Vs. SHAMBHULAL C BACHKANIWALA

JUDGEMENT

(1.) THE CIT, Surat, being aggrieved by an order passed by the Tribunal has preferred this application. The Tribunal was moved by preferring six applications to refer the questions for the opinion of this Court. The finding pertaining to similar question/s would cover other references as well. So far as Appln. No. 266 of 1999 is concerned, the following three questions were sought to be referred by the applicant :

(2.) WE will deal with question No. 3 first. Mr. Naik submitted that, when the expert has given his opinion, the Tribunal was not justified in granting further deduction of 10 per cent on alloy contents. It appears that the contentions raised by the assessee were rejected by the Tribunal. The articles, namely, silver utensils, weighing approximately 60 kgs. valued at Rs. 4,26,800 were put under prohibitory order in the custody of the assessee on 21st Nov., 1996. The value was assessed at the rate of Rs. 7,100 per kg. It transpires that the articles were seized later on 9th Jan., 1997. The utensils were weighed and it was found that the total weight was 75.455 kgs. as against the approximate weight of 60 kgs. So far as the value is concerned, it was calculated by the expert at the rate of Rs. 6,800 per kg. The assessee contended that if the valuation is taken after allowing deduction of 20 per cent on account of alloy used in the manufacture of silver articles, then, there will be no addition considering the price difference. It appears that the Departmental Representative supported the order of the AO, however, he fairly conceded that some deduction on account of use of alloy in the manufacture of silver articles/utensils should have been given by the AO and it is in view of this that 10 per cent deduction has been given. Therefore, question No. 3 cannot be said to be a question of law.

(3.) SO far as question No. 1 is concerned, we were taken through the assessment order and the decision rendered by the Tribunal. In para 12.9, undisclosed income is considered for the period from 1987 88 to 1990 91 on the basis of turnover. The AO estimated undisclosed income at the rate of 12.40 per cent of the turnover. The AO has noted in para 12.2 as under :