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b). whether, in addition to the addition toward unexplained physical stock, or even otherwise, any addition toward excess book-stock of any saleable material is called for in the facts and circumstances of the case?
c). the value at which the addition/s, if any, referred to at
(a) and/or (b) above, is to be made.

These are also the three issues arising out of the several grounds assumed by the parties before us.

4.2 At the outset we note that the moot question arising is as to what constitutes finished (saleable) iron ore, i.e., its defining attribute, distinguishing it from the subgrade material; the latter being not readily saleable, and being now (since January, 2015) sold to the beneficiation plants at a fraction of the price fetched for the finished stock. We say so as while 'finished-good' is on physical stock-taking found to be in excess, the 'sub- grade' found short (i.e., at 43,271.43 MT, as against a book-stock of 1,92,400 MT), so that correct categorization becomes crucial. However, we observe no dispute either as regards the quantity of the iron ore found in various dumps or as to its classification (as finished-good or subgrade). The processed iron ore in dumps, quantified at 1,35,681.6 MT (by IBM), which quantity is not in dispute, would stand to be categorized as finished iron ore, as done by IBM (& adopted by the Revenue), considering that the grade thereof varies between 50.12% to 54.32% (refer para 2), which agrees with the consideration by the assessee of that with grade below 50% as subgrade, coupled with the fact of I.T.A. Nos.51,52,77& 78/JAB/2018 Assessment year:2015-16 the assessee paying royalty on the sale of finished goods under the grade class 'below 55%' (refer paras 2, 3.1). The quantity of laterite and manganese ores has neither been physically taken nor, consequently, compared. How can, then, even as ld. CIT-DR argues, the AO be faulted with?

Why, it is not clear, or understood, should the ROM continue to be not processed; in fact, to any extent, to yield finished goods (FG)? This is any I.T.A. Nos.51,52,77& 78/JAB/2018 Assessment year:2015-16 firm would ordinarily consume its' existing raw stock for production, rather than setting it aside & acquiring fresh stock for the purpose. Why, again, should not the sub-grade material, which arises on physically processing (crushing, screening and sorting) the raw stock, being, as stated, at about 80% of the iron ore processed, get generated - and in that ratio, along with the regular finished stock production (which is at 66,000 MT during the period for which the reports are available)? The non-generation of waste is understandable in the absence of any mention thereof in the current Mining Plan (for 2013-14 to 2017-18)(MP-2). The laterite and manganese ore production should, again, be about 90% of the total finished iron ore production, and in the ratio of 2:1, i.e., in terms of the Mining Plan itself, while it is only at 500 MT (i.e., as against an iron ore production of 66,000 MT). The production (of iron ore) is saleable, and which position, besides being borne out by the record, agrees with the assessee's case of iron ore being saleable in the grade class 50%-55%, with that below 50% being liable to be regarded as sub-grade; the assessee paying royalty on sale of finished goods under the grade class 'below 55%' (also see para 4.2, Table 3).

- and not of the iron content, much less in the sub-grade, the balance 15% (of ROM) being laterite and manganese ores. Why, the assessee itself admits of a substantial part of the sub-grade being unusable wast (refer para 9 of its' letter dated 15/12/2016 /PB-2 (pgs. 1-21), and para 26 of it's letter dated 23/11/2017, reproduced in the impugned order, appearing at pg. 37 thereof). Couple this with the information as to a large part (80%) of the processed iron ore bearing low-grade iron. Where, then, one may ask, is the scope of iron recovery at 85% therefrom? Pg. 36 of MP-2 is the chemical analysis of ROM stock of iron ore, stated to be at 85% of the total mineral. The average iron (Fe) content stated is 55.36% - the balance being other compounds, viz. Fe2O3; SiO2; Al2O3, etc., even as explained by NS during hearing. This is also borne out by the sample analysis reports in MP-1 (for 2008-09 to 2012-13). The assesse in fact itself, vide its' Gd. 5, states of iron content in the subgrade to be at 50%, i.e., as stated during hearing. The sub-grade material is by definition low grade material, with an iron (manganese) grade at 45% (10%) or below being liable to be regarded as waste (also see 4.7). The assessee was unable to explain this anomaly during hearing. The IBM report dated 12/1/2017, to which the assessee refers in support (para 3 thereof), states of considering all the materials, including OB/waste, for the purpose of computing the total excavation, and not for any other purpose., so that reliance thereon is misconceived, even otherwise apparent from the foregoing.

Coming to the difference worked per the assessee's earlier letter (dated 09/12/2016), as apparent from the AO's letter dated 10/12/2016 to IBM, the same is at 1,13,582.6 MT, and which perhaps also explains the said certificate, found as without any definite basis. In this letter the assessee, in seeking to explain the difference in finished (processed) iron ore, also includes raw stock (ROM), as well as laterite and manganese ores, as well as their component in the sub-grade material, making the reference by us to the example of 'raw I.T.A. Nos.51,52,77& 78/JAB/2018 Assessment year:2015-16 material' (qua a manufacturing process) equally applicable. ROM is raw stock, not physically taken, nor compared, and at a constant in the assessee's returns for the past several months (also refer para 4.3). There is no question of the iron content therein, stated to be in the range of 48%-50%, being taken into account in comparing the inventory of finished goods. It is perhaps on realizing its' folly in doing so, that the assessee revises it's calculation to 36,400 MT, i.e., less than 1/3 of the original.