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The Tax Publishers ACIT v. Sahyadri Starch & Investments Ltd. [ITA Nos. 7474, 6492 (Mum) of 2011, dt. 24-2-2016] Addition made on account of non-distinguishing texture of the by-product *Facts:* Assessee was in the business of manufacturing starch and liquid glucose. During assessment year 2007-08 assessing officer after perusing the consumption and quantitative details made an addition of Rs. 4.83 crores by way of undisclosed sale of Maize, Bran, Glutten and Husk etc. citing that the quantitaive details do not cross tally to that of the earlier year. Consequential protective assessment was made of the said addition in assessment year 2006-07. On appeal to the Commissioner (Appeals) the assessee almost 30 year old company in the business established on facts that what was shown as quantitative details in previous year was on wet basis and that of the current year was on dry basis. The difference in quantity thus being nearly 3:1 due to the texture of the product. Commissioner (Appeals) accepted the same on facts and cancelled the addition. On further appeal - Held by the ITAT in favour of the assessee that the texture between wet and dry was not foreseen by the assessee. The addition of the quantity would mean a yield of more than 100% of the raw material in the business which was never possible thus upheld the order of the Commissioner (Appeals).

The Tax Publishers

ACIT v. Sahyadri Starch & Investments Ltd. [ITA Nos. 7474, 6492 (Mum) of 2011, dt. 24-2-2016]

Addition made on account of non-distinguishing texture of the by-product

Facts:

Assessee was in the business of manufacturing starch and liquid glucose. During assessment year 2007-08 assessing officer after perusing the consumption and quantitative details made an addition of Rs. 4.83 crores by way of undisclosed sale of Maize, Bran, Glutten and Husk etc. citing that the quantitaive details do not cross tally to that of the earlier year. Consequential protective assessment was made of the said addition in assessment year 2006-07. On appeal to the Commissioner (Appeals) the assessee almost 30 year old company in the business established on facts that what was shown as quantitative details in previous year was on wet basis and that of the current year was on dry basis. The difference in quantity thus being nearly 3:1 due to the texture of the product. Commissioner (Appeals) accepted the same on facts and cancelled the addition. On further appeal -

Held by the ITAT in favour of the assessee that the texture between wet and dry was not foreseen by the assessee. The addition of the quantity would mean a yield of more than 100% of the raw material in the business which was never possible thus upheld the order of the Commissioner (Appeals).