2017 (4) TMI 909

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....propos are that assessee, engaged in the business of poultry and feed was subjected to search on 05.08.2011. Simultaneously, proceedings under Section 133A of the Income-tax Act, 1961 (in short 'the Act') were also initiated in the premises of the group companies. In response to notice under Section 153A of the Act, assessee filed return for the impugned assessment years declaring the following income:- Sl. No. Assessment Year Date of filing of return u/s 139(1) Income originally returned u/s 139(1) (Rs.) Date of filing of return in response to 153A Notice Returned Income u/s. 153A (Rs.) Additional Income Offered (Rs.) 1. 2006-07 19.10.06 4,06,39,540 (Firm) 21.08.2013 4,18,70,540 12,31,000 2. 2007-08 23.10.07 23.10.07 8,39,051 (firm) 4,90,96,061 (Co) 21.08.2013 6,52,40,210 1,34,87,839 3. 2008-09 29.07.08 1,00,15,920 21.08.2013 2,61,70,510 96,52,840 4. 2009-10 08.09.09 15,79,84,730 21.08.2013 16,49,96,890 70,12,159 5. 2010-11 20.08.10 41,65,54,860 21.08.2013 42,93,52,800 1,27,97,940 6. 2011-12 29.09.11 69,12,47,360 21.08.2013 70,10,76,190 98,28,831 7. 2012-13 11.09.12 40,20,09,300 21.08.2013 40,84,86,750 64,77,448 &nbs....

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....above data, the assessee worked out the additional income from sale of poultry droppings as under:- F.Y. 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Average Poultry droppings used for own consumption per annum in Tons 1680 2848 2100 2604 3192 3612 1233 Average selling price of poultry droppings per annum per Ton 600 640 680 710 740 760 760 Average manure consumption per annum in Rupees (A) 1008000 1182720 1428000 1848840 2362080 2745120 937080 Average poultry droppings sales per annum in Tonn 280 308 350 434 532 602 205 Average manure total sales value per annum in Rupees (B) 168000 197120 238000 308140 393680 457520 155800 Additional income on account of manure sales (A) + (B) 1176000 1379840 1666000 2156980 2755760 3202640 1092880   In support of the above, assessee produced a letter from one Prof. D. Narahari, Senior Vice President of Indian Poultry Science Association. The Ld. A.O. 6. After considering the evidence and details filed by the assessee, Ld. A.O. concluded that the expert opinion provided by the assessee had fixed average feed consumption of a bird at 55 to 60 KGs for a 60-week period....

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.... the stock of birds while working out the bird droppings. 7. Now before us, the Ld. Departmental Representative submitted that the average rate of poultry dropping at 19.10 Kgs per bird was correctly worked out by the Assessing Officer considering the facts and circumstances of the case. According to him, Assessing Officer was having an expert opinion obtained by the Department which justified the quantity of poultry dropping fixed by the Assessing Officer. Further, as per the Ld. D.R., the CIT(Appeals) fell in error in giving directions to the Assessing Officer to exclude the birds grown through contract farms while working out the stock of poultry droppings available for sale. As per Ld. D.R., such exclusion would result in a lower number of birds than the average stock admitted by the assessee. 8. Per contra, the Ld. A.R. supported the order of the CIT(Appeals). 9. We have perused the orders and heard the rival contentions. While estimating the yield of poultry dropping, the Assessing Officer admittedly had relied on an expert opinion given by Prof. D. Narahari, Senior Vice President of Indian Poultry Science Association. The extract of such opinion as it appears in assessmen....

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....own by contracting farms, the relevant observation of the CIT(Appeals) is reproduced hereunder:- "7.4 It is submitted before me that the appellant grows parent birds in his own farm and also with contracting farms. As per the existing practice in the trade, poultry contracting farmers gets the growing charges per bird periodically in addition to that poultry manure. All bird droppings belong to the contracting poultry farmers. On perusal of the assessment order I find that A.O. has calculated bird droppings based on the closing stock of birds. It is apparently seen that assessing officer has not calculated the number of birds grown at contracting farms. It has to be excluded for the purpose of arriving at bird droppings income. The assessing officer is directed to work out the bird droppings (manure) after excluding birds grown at contracting farms. Accordingly, the grounds raised in this regard are allowed for all the asst. years i.e. 2006-07 to 2012-13." Insofar as bird droppings were concerned, Assessing Officer himself had excluded bird droppings of poultry raised by contracting farms. Such reduction in bird droppings, as noted by the Ld. CIT(Appeals), was to be based on the ....