COMMISSIONER OF INCOME TAX Vs. VIRENDRA & CO.

JUDGEMENT

(1.) This appeal by the revenue under section 260A of the Income Tax Act, 1961 (hereinafter referred to as the "said Act") seeks to challenge the order dated 28th January, 2000 of the Income Tax Appellate Tribunal (hereinafter referred to as the "ITAT") relating to Assessment Year 1986-87. This appeal was admitted on 27th June, 2005 by this court on the following substantial questions of law.

(2.) Brief facts leading to this appeal are as under:

(3.) The ITAT on the basis of the evidence before it has come to the conclusion that 0.81 % of the total recovery being attributed to non ferrous scrap generated during the course of ship breaking by the respondent assessee was correct. It is pertinent to note that the respondent assessee had maintained excise record and its books were audited and the department does not challenge the purchases and sales reflected in the respondent's books of accounts. It is important to note that between 0.90% to 1.40% of non ferrous scrap being generated out of the total scrap on the activity of ship breaking has been accepted by the department upto the Assessment Year 1990- 91. The Advocate for the respondent-assessee points out that even for subsequent assessment years 1992-93 to 1996-97, generation of non ferrous scrap at 0.81% had been accepted by the department.