ORDER : AKIL KURESHI, J. 1. The assessee has filed this appeal challenging the judgment of the Incometax Appellate Tribunal, Rajkot (hereinafter referred to as ‘the Tribunal’) dated July 31, 2013, raising the following questions for our consideration : “(i) Whether, in the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in law in vacating the action of the CIT (A) who had held that there were no defects in the books of accounts of the appellant, especially when the Tribunal had held there is no defect in the books of accounts in the appellant's own case for the A.Y. 200405 ? (ii) Whether, in the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in law in sustaining addition of Rs.1.49 crores (gross profit rate of 2%) out of total addition of Rs.2.53 crores (gross profit rate of 2.46%) which itself was erroneously made by the Respondent on the basis of estimation ?” 2. Briefly stated the facts are that for the assessment year 200506 in the case of the appellantassessee, the Assessing Officer rejected the books of accounts and made various additions, in particular, on the premise of low output as compared to the electricity consumption and made matching additions. The assessee carried the matter in appeal. The CIT (Appeals) allowed the assessee’s appeal on this score and deleted the addition. 3. This time the Revenue carried the matter in appeal before the Tribunal. The Tribunal at one stage allowed the Revenue’s appeal by an order dated October 16, 2009 and restored part of the additions made by the Assessing Officer. The assessee thereupon filed Tax Appeal No.2398 of 2009 before the High Court. The High Court remanded the matter before the Tribunal observing that the Tribunal had not given independent reasons why the CIT (Appeals) was not justified in estimation of gross profit. In the second round of hearing, the Tribunal passed the impugned order and made addition on the basis of gross profit rate of 2% as compared to 2.46% adopted by the Assessing Officer. It is this fresh order which has given rise to the present Tax Appeal. 4. In the second round of hearing, the Tribunal passed the impugned order and made addition on the basis of gross profit rate of 2% as compared to 2.46% adopted by the Assessing Officer. It is this fresh order which has given rise to the present Tax Appeal. 4. The learned counsel Shri Soparkar for the appellantassessee has strenuously taken us through the material on record and raised the following contentions : (i) The Revenue’s appeals being Tax Appeal Nos.269 and 270 of 2012, involving similar questions for earlier assessment years are admitted and pending before the Court. (ii) The Assessing Officer as well as Tribunal committed a serious error in rejecting the book results only on the ground of irregular pattern of consumption of electricity. He relied on the following decisions in support of his contention: 1. St. Teresa's Oil Mills vs. State of Kerala, reported in 76 ITR 365. 2.Commissioner of Incometax vs. Sulabh Marbles (P) Ltd., reported in 73 ITR 224. 3. N. Raja Pullaiah vs. Deputy Commercial Tax Officer, Kurnool and another, reported in 205 CTR 464. (iii) The Tribunal has not given any reasons for adopting the GP rate of 2% though the High Court has provided specifically in the remand order. 5. Having heard the learned counsel for the assessee and having perused the material on record, we do not find that the appeal gives rise to any substantial question of law. 5.1 Tax Appeal Nos.269 and 270 of 2012 filed by the Revenue pertain to the earlier assessment years and their admission per se would not convince us to admit this appeal as well. More importantly, the questions framed in such admission order pertain to the propriety of the Tribunal making deletions in Miscellaneous Application. The learned counsel for the assessee, however, would contend that this reference to the Miscellaneous Application in the questions framed is erroneous and the issue arises in the order passed by the Tribunal, not in Miscellaneous Application. Be that as it may, we have perused the questions and considering that the appeals pertain to another assessment year altogether, mere pendency of such appeal would not persuade us to admit assessee’s appeal. By very nature of the issue, the consideration of it would depend on the material on record. Be that as it may, we have perused the questions and considering that the appeals pertain to another assessment year altogether, mere pendency of such appeal would not persuade us to admit assessee’s appeal. By very nature of the issue, the consideration of it would depend on the material on record. Consideration of such an issue therefore in each year will have to be separately done on the basis of evidence on record in each year. 5.2 Coming to the question of rejection of book results and additions sustained by the Tribunal, we notice that the Assessing Officer as well as the Tribunal noticed a rather irregular pattern of output by the assessee in comparison to the electricity consumption. If we record such facts which are not seriously in dispute from the order of the Tribunal, it emerges thus : “20. Be that as it may, the matter now stands restored to the file of this Tribunal. We have therefore independently examined all the relevant aspects of the case in the light of the applicable law. The assesseefirm itself filed details giving monthwise production of oil and monthwise consumption of power. They have been extracted from the assessment order and reproduced earlier in this order. The assessee is engaged in the production of groundnut oil, groundnut refined oil as well as small quantity of cotton seed oil . In the month of April, the assessee reported production of 4,91,003 kgs. of groundnut oil and 33,185 kgs of refined groundnut oil for which it reported consumption of 18,191 units of power which resulted in average production of 28.81 kg. of oil for each unit of power consumed. In the month of December, the assessee reported production of 4,43,569 kgs of groundnut oil, 74,537 kgs of refined groundnut oil and 27,885 kgs of cottonseed oil against consumption of 27725 units of power resulting in average production of 19.69 kg. of oil for each unit of power consumed as against average production of 28.81 kgs. of oil against each unit of power consumed in the month of April. In the month of March, the assessee reported production of 20,441 kgs of groundnut oil, 35,353 kgs of groundnut refined oil and 2,82,871 kgs of cotton seed oil against 11999 units of power consumed resulting in average production of 28.22 kgs. against each unit of power consumed. of oil against each unit of power consumed in the month of April. In the month of March, the assessee reported production of 20,441 kgs of groundnut oil, 35,353 kgs of groundnut refined oil and 2,82,871 kgs of cotton seed oil against 11999 units of power consumed resulting in average production of 28.22 kgs. against each unit of power consumed. Similarly, production (in kg.) of oil against each unit of power consumed in the month of August worked out to 5.99 kgs. The figures as supplied by the assessee and reproduced in paragraph 3 of the assessment order give a clear indication that the production recorded by the assessee in its books of account is completely inconsistent with the pattern of power consumed. There can be some fluctuations in the consumption of power on daytoday basis but such fluctuations have got to be within reasonable limits. Once the average for the whole month is taken as it has been taken by the assesseefirm itself, the daytoday fluctuations or asymmetrical consumption of power at times are automatically taken care of. The consumption of power is directly linked with the production. Consumption of power is recorded and charged by the Electricity Board/ power supplying company and therefore the assessee cannot change those figures of units which have actually been consumed. Figures of production, on the other hand, are recorded by the assessee itself in its books. All the machines used in industries are power rated which means that the running of oil mill and consequential production of oil depends to a large extent on rated consumption of power. Consumption of power is one of the most objective criteria to assess the running of the mill and consequential production. Subject to some adjustments, the units of power consumed give a fairly good idea about the running of the mill and consequential production achieved. At the time of hearing, the ld.Counsel for the assessee was specifically asked to spell out the reasons for such lower production of oil as reported by the assessee in certain months qua the power consumed. He however expressed his inability to do so. All the reasons given by the assessee before the ld.CIT(A) in this behalf do not satisfactorily explain the reasons for such lower production qua consumption of power in all the other months of year as compared to the month of April. He however expressed his inability to do so. All the reasons given by the assessee before the ld.CIT(A) in this behalf do not satisfactorily explain the reasons for such lower production qua consumption of power in all the other months of year as compared to the month of April. There is thus no satisfactory explanation for lower production in several months of the year under appeal against power consumed. Another important aspect, which cannot be lost sight of, is the monthwise yield groundnut oil, groundnut refined oil and refined cotton seed oil. There is wide and abnormal fluctuation in the monthwise yield of groundnut oil, refined groundnut oil and cotton seed oil. There is no satisfactory explanation for such wide fluctuations. Yet another fact of significance, which has been highlighted by the ld.CIT(A) in his appellate order, is that the assessee has not recorded workin progress in the books of account which let the ld.CIT(A) himself to make addition of Rs.9,57,432/. We are in agreement with the observation of the CIT (A) that it is not possible to have nil workinprogress in oil producing mills. This shows that the purchases of raw materials, their processing and ultimate production have not been correctly shown by the assessee in its books of account. In the case of the such materials on record, we are convinced that the assessee has not recorded procurement and processing of raw materials as also production and sale of oil truly and correctly in its books of account and therefore the books of account maintained by the assessee cannot be said to be correct and completed to that extent. Finding recorded by the ld.CIT(A) that there is no defect in the books of account is therefore unsustainable. Having held that the assessee has not recorded workinprogress in its books and consequently made addition of Rs.9,57,432/on that basis, it was not open to the CIT(A) to hold that there were no defects in the books of account. The decision of the CIT(A) in this behalf therefore deserves, on the facts of the case, to be vacated and is accordingly vacated.” 5.3 From the above, it can be seen that the average production from using of power consumption widely fluctuated from month to month. The explanation rendered by the assessee was not accepted. It was, therefore, that the Tribunal agreed to reject the book results. The explanation rendered by the assessee was not accepted. It was, therefore, that the Tribunal agreed to reject the book results. Significantly, the Tribunal noted that in addition to such fluctuation in the output ratio, the assessee also did not record the work in progress in its books of accounts. It is because of this that the CIT (Appeals) who substantially allowed the assessee’s appeal, was still persuaded to make addition of Rs.5.72 lakh on this score. 5.4 The Tribunal has, therefore, in our opinion, rightly recorded that the CIT (Appeals) thus effectively and essentially rejected the books of accounts of the assessee. From the above, it can be seen that not only Assessing Officer but CIT (Appeals) and Tribunal also found that the books of accounts of the assessee could not be accepted. In addition to wide fluctuation in the productivity compared to the electricity consumption, significant factor was that the assessee had not recorded the workinprogress in the books of accounts. 5.5 This was, therefore, not a case where book results were rejected merely on unusual electricity consumption rate, but on additional factors, including the factor that for considerable fluctuation in the output ratio, the assessee’s explanation was not found acceptable. We have perused the explanation rendered by the assessee which found favour with the CIT (Appeals). The principle explanations were that the assessee was engaged in oil extraction from different oil seeds and further that Gujarat Electricity Board would issue bills for minimum contracted units, whether they were consumed or not. 5.6 Except for merely suggesting these factors, the assessee produced no further evidence. If the oil output was vastly different for different oil seeds, which was the reason for fluctuation in productivity, the assessee could have easily demonstrated from the books of accounts and other literature. Merely suggesting that the Gujarat Electricity Board would issue the bills for minimum contracted units without full consumption, is merely stating the obvious. The assessee could have pointed out from such bills that the amounts charged did not match full consumption. In fact, the Tribunal’s findings are based on the consumption of units of electricity and not on the bills raised by the Gujarat Electricity Board on fixed/ committed charge basis. 5.7 The decisions cited before us rest on slightly different facts. In the case of St. In fact, the Tribunal’s findings are based on the consumption of units of electricity and not on the bills raised by the Gujarat Electricity Board on fixed/ committed charge basis. 5.7 The decisions cited before us rest on slightly different facts. In the case of St. Teresa (supra), the Kerala High Court observed that in the case on hand, the only ground relied on by the authority for rejection of accounts was wide disparity in consumption of electricity. In the case of N.Raja Pullaiah (supra), the Andhra Pradesh High Court once again on similar facts rejected the Revenue’s stand. In the case of Sulabh Marbles (P) Ltd. (supra), the Rajasthan High Court upheld the finding of CIT (Appeals) and Tribunal that in absence of any defect in the books of accounts, the same could not be rejected merely on the basis of quantum of electricity expenses holding that such observations were based on relevant material on record and, therefore, no question of law arises. These observations are based on different facts and, therefore, distinguishable. 5.8 Coming to the question of estimation of gross profit, the Tribunal has given the following reasons for adopting the rate of 2% : “23. The assesseefirm itself has reported average production/ yield of 28.81 kgs of oil against each unit of power consumed in the month of April 2004. In the absence of any satisfactory explanation, the aforesaid fact provides a reasonable basis for working out the suppressed production on the basis of units of power consumed in remaining months of the year. Calculated in the aforesaid manner, the quantity of suppressed production of oil in the year under appeal works out to about 31,84,708 kgs of oil. According to the assesseefirm, the average selling price of oil was about Rs.800 per 15 kg. in the year under appeal. Suppressed value of sale thus works out to about Rs.16.98 crores. Even if modest margin of 2% (being consumed) is applied on such suppressed sales, the resultant addition on account of suppressed profit alone would be about Rs.2.40 crores. Then, further addition on account of initial investments in procurement of raw materials outside the books would also have to be considered. If all the aforesaid factors are taken into account, the resultant addition would be much more than what the AO has made (i.e. Rs.2,53,44,285/) or what this Tribunal has earlier confirmed (i.e. about Rs.1.49 crores). Then, further addition on account of initial investments in procurement of raw materials outside the books would also have to be considered. If all the aforesaid factors are taken into account, the resultant addition would be much more than what the AO has made (i.e. Rs.2,53,44,285/) or what this Tribunal has earlier confirmed (i.e. about Rs.1.49 crores). It may however be stated that the earlier order passed by this Tribunal by which the AO was directed to apply gross profit rate of 2% as against 2.46% applied by him was not challenged by the Revenue was satisfied with the earlier order passed by this Tribunal. In this view of the matter, we sustain addition, on the facts of the case, to the extent of Rs.1.49 crores (as originally sustain by this Tribunal by applying gross profit rate of 2%) out of total addition of Rs.2,53,44,285/ made by the AO (by applying gross profit rate of 2.46%) towards gross profit. The issue as restored by the Hon'ble High Court to this Tribunal is disposed of accordingly. For statistical purposes, both the appeals shall be treated, as they were originally treated, as partly allowed.” 5.9 Here also the entire issue is based on appreciation of material on record. The Tribunal having given its consideration and having adopted the GP rate of 2% by giving its own reasons, we do not find that any question of law, much less any substantial question of law arises. 6. Resultantly, the Tax Appeal is dismissed.