This is appeal filed by assessee against orders of ld. Commissioner of Income-tax (Appeals), New Delhi dated 16-8-2005 for assessment year 2002-03, in matter of order passed under sections 143(3) of Income-tax Act, 1961. 2. Following grounds have been raised by assessee: "(1) That having regard to facts and circumstances of case, ld. CIT(A) has erred in law and on facts in confirming action of Assessing Officer in including excise duty of Rs. 77,69,199 as part of turnover for purpose of calculating deduction under section 80HHC and has further erred in not following judgement of Honble Income-tax Appellate Tribunal passed in case of assessee company for assessment year 1998-99 holding that excise duty was not part of turnover for calculating deduction under section 80HHC. (2) That having regard to facts and circumstances of case, ld. CIT(A) has erred in law and on facts in confirming action of Assessing Officer in including amount of sale of scrap of Rs. 8,52,811 and amount of job work for Rs. 1,43,450 as part of turnover for purpose of calculating deduction under section 80HHC. (3) That having regard to facts and circumstances of case, ld. CIT(A) has erred in law and on facts in confirming action of Assessing Officer in denying under section 80HHC in respect of interest of Rs. 1,58,152 from bank and Rs. 11,238 from ABN Amro Bank and Rs. 6,606 as miscellaneous income and has further erred in not allowing netting of above amount against interest paid and thereafter allowing deduction under section 80HHC. (4) That having regard to facts and circumstances of case, ld. CIT(A) has erred in law and on facts in confirming action of Assessing Officer in making disallowance of Rs. 1,01,200 out of tools consumed by treating them as capital expenditure. (5) That having regard to facts and circumstances of case, Assessing Officer has erred in law and on facts in confirming action of Assessing Officer in charging interest under section 234B for 5,24,117 even though there was no order to charge interest under this section in body of assessment order and has further erred in not directing Assessing Officer to give credit of MAT under section 115JAA brought forward from last year before charging interest under section 234B. (6) In any view of matter and in any case order passed by Ld. CIT(A) is contrary to facts and law, arbitrary, against principal of natural justice and deserves to be quashed. (7) That appellant craves leave to add, modify, amend or delete any of ground of appeal at time of hearing and all above grounds are without prejudice to each other." 3. Rival contentions have been heard and records perused. Ground No. 1 with regard to inclusion of excise duty in total turnover for purpose of calculation of deduction under section 80HHC, is squarely covered by order of Tribunal in assessees own case for assessment year 1998-99 vide order dated 22 July, 2005. issue is now no more res integra in view of decision of Honble Supreme Court in case of CIT v. Laxmi Machine Works [2007] 290 ITR 667. This ground of assessees appeal, therefore, stands allowed. 4. With regard to inclusion of sale of scrap and job work receipt in total turnover for purpose of calculation of deduction under section 80HHC is also squarely covered by order of Tribunal vide order dated 22 July, 2005, wherein ITAT Special Bench in case of IFB Agro Industries Ltd. v. Dy. CIT [2002] 83 ITD 96 (Cal.) was followed and issue was decided in favour of assessee. Following was conclusion of Special Bench: "Though total turnover may include receipts of excise duty and sales tax etc. in its general parlance and under specific statute, because of its wider coverage in definitions given thereunder, it has to be given restrictive meaning while computing export profit for purpose of section 80HHC namely, only that part of receipt for sale consideration is to be taken as part of total turnover which has element of profit therein and, accordingly, receipt of excise duty and sales-tax which do not include element of profit should be excluded from total turnover. In result, Assessing Officer was directed to compute deduction under section 80HHC on export profits arrived at on basis of export turnover and total turnover exclusive of receipts of excise duty and sales tax." 5. As facts and circumstances during year under consideration are in pari materia, respectfully following ITAT order for assessment year 1998- 99, issue is decided in favour of assessee. 6. With regard to grant of deduction on account of interest income while computing deduction under section 80HHC, we have considered rival contentions. issue regarding treatment of interest income while computing deduction under section 80HHC has been elaborately considered by Jurisdictional High Court in case of CIT v.Ram Honda Power Equip [2007] 289 ITR 475 (Delhi) Broad principles for determining nature of interest income, as to whether such interest income is "business income" as computed under section 28 to 44 of Act or income from other sources as determined under section 56 read with section 57 of Income-tax Act were laid out. first category of such interest income was held by Honble High Court as arising out of parking of surplus fund, such income is to be treated as income from other sources. second category of cases are those where Assessing Officer himself treats interest income as income from business, on plea that such interest income was not inextricably linked with export business. Here we are concerned with first category where Assessing Officer treats such income as not related to business of exports, but as income from other sources. However, Jurisdictional High Court in such situation have held that these receipts merits separate treatment under section 56 of Act which is outside ring of profit and gains from business and profession. court has further provided that to give effect to this position, Assessing Officer while computing profits of export business will have to remove from debit side of Profit & Loss Account, corresponding interest expenditure that had been "laid out" to earn such income from other sources. Otherwise, this will depress profit by amount which is out of reckoning of section 80HHC, consequence not intending to be brought about. Following is relevant observation of Honble High Court at Para 19: "We are therefore of view that where surplus funds are parked with bank and interest is earned thereon it can only be categorized as income from other sources. This receipt merits separate treatment under section 56 of Act which is outside ring of profit and gains from business and profession. It goes entirely out of reckoning for purpose of section 80HHC. To give effect to this position, Assessing Officer while computing profits of export business will have to remove from debit side of Profit & Loss Account corresponding interest expenditure that has been laid out to earn such income from other sources. Otherwise this will depress profits by amount which is out of reckoning of section 80HHC, consequence not intended to be brought about." 7. It is quite clear from above proposition that if assessee has incurred any expenditure for making FDRs, interest income of which is brought to tax under head income from other sources, such interest expenditure is to be taken out from profits of export business, and at same time such interest expenditure is to be deducted while arriving at net income from interest on bank deposit. Taking out such interest income and interest expenditure out of Profit & Loss Account prepared for computing export profits, will change such export profit, therefore, Assessing Officer is to recalculate permissible deduction under section 80HHC with reference to such revised export profits. On other hand, such interest expenditure is to be allowed as deduction while computing net interest income to be taxed under section 56 as income from other sources. In view of proposition laid down by Jurisdictional High Court as discussed above, Assessing Officer is required to exclude any interest expenditure if any relatable to such income from Profit & Loss Account of export business. At very same time such interest expenditure is required to be reduced from interest income for bringing net interest income to tax net under section 56 of Income-tax Act. However, before allowing such interest expenditure, assessee is required to establish that it had incurred interest expenditure for getting bank deposit on which interest income was earned. Only where assessee is able to prove that cheques issued for making bank deposits had been issued out of credit facilities availed by it or out of borrowed funds, such exclusion of interest expenditure is permissible. If Assessing Officer found that no interest expenditure had been incurred for making such bank deposits on which assessee is in receipt of interest income, no deduction of interest expenditure under section 57 is permissible, nor export profit as per Profit & Loss Account is required to be disturbed. We, therefore, restore matter back to file of Assessing Officer for deciding issue of deduction of interest expenditure out of interest income earned by assessee and recomputation of deduction under section 80HHC in light of our observation and proposition laid down by Jurisdictional High Court in case of Shri Ram Honda Power Equip (supra). We direct accordingly. 8. With regard to disallowance of expenditure of Rs. 1,01,200 out of tools consumed, we found that impugned expenditure were incurred for specific gauge purchased for measuring various dimensions and specification for special purpose machines manufactured by assessee. After machines have been manufactured, these gauges are of no use because each machines made was of special quality and orders were not in repetitive basis. Thus keeping in view nature of such tools, we do not find any justification for disallowing claim of its expenditure on plea of some being capital in nature. 9. In Ground No. 5 assessee is aggrieved for charging of interest under section 234B. Reliance placed by ld. AR on decision of Honble Supreme Court in case of CIT v. Kwality Biscuits Ltd. [2006] 284 ITR 434, Honble Supreme Court comprising of three judged observed that assessment is one integrated process involving not only assessment of total income but also determination of tax. latter is as crucial for assessee as former. It will not be, therefore, correct to read provision as leaving undefined process of determination of net sum payable by assessee. statute does not, however, require that both computations (i.e. of total income as well as of sum payable) should be done on same sheet of paper, sheet that is superscribed as "assessment order". It does not prescribe any form for this purpose. It will be appreciated that once assessment of total income is complete with indications of deductions, rebates, reliefs and adjustments available to assessee, calculation of net tax payable is process which is mostly arithmetical but generally time-consuming. If therefore, ITO which is mostly arithmetical but generally time-consuming. If therefore, ITO first draws up order assessing total income and indicating adjustments to be made, directs office to compute tax payable on basis and then approves of it, either immediately or some time later, no fault can be found with process, though it is only when both computation sheets are signed or initialed by ITO that process described in section 143(3) will be completed. In this context, one may take notice of fact that, initially rule 15(2) of Income-tax Rules prescribed Form No. 8, sheet containing computation of tax, though there was no form prescribed for assessment of income. This sub-rule was dropped in 1964, thereafter, matter has been governed by Departmental instructions. Under these, two forms are in vogue. One is form of, what is described as, "assessment order", IT 30 or ITNS 65. other is what is described "Income-tax Computation Form" or "Form for assessment of Tax/Refund" (ITNS 150). practice is that after "assessment order" is made by ITO tax is calculated and necessary columns of ITNS 150 are filled up showing net amount payable in respect of assessment year. This form is generally prepared by staff but it is checked and signed or initialed by ITO and notice of demand follows thereafter. statute does not in terms require service of assessment order or other form of assessee and contemplates only service of notice of demand. While "assessment order" used to be generally sent to assessee, order form is retained on file and copy is occasionally sent to assessee. ITNS 150 is also form for determination of tax payable and when it is signed or initialed by ITO, it is certainly order in writing by ITO determining tax payable within meaning of section 143(3). It may be only tax calculation form for Departmental purposes as it also contains columns and code numbers to facilitate computerization of particulars contained therein for statistical purposes but this does not detract from its being considered as order in writing determining sum payable by assessee. There is no reason why this document, which is also in writing and has received imprimatur of ITO, should not be treated as part of assessment order in wider sense in which expression has to be understood in context of section 143(3). 10. In view of above decisions of Honble Supreme Court, interest under section 234B was correctly charged by Assessing Officer notwithstanding fact that in assessment order there was only direction for charging of interest and no specific direction for charging of interest under section 234B. However, in instant case we found that while computing interest under section 234B Assessing Officer has not given credit for MAT under section 115JA brought forward from last year. In interest of justice we restore matter back to file of Assessing Officer for recomputing interest under section 234B after giving due credit for MAT as well as advance tax paid by assessee. We direct accordingly. 11. In result, appeal of assessee is allowed in part in terms indicated hereinabove. 1. petitioner is income-tax assessee. For assessment year 1993-94, by Ext. P1 order interest under section 234B of Income-tax Act, 1961 (the Act) towards delayed remittance of advance tax was levied. petitioners appeal before Commissioner (Appeals) against assessment was partly allowed. Consequently, revised order giving effect to appellate order was issued (Ext. P2) dated 22-10-1996 by Dy. Commissioner. Interest under section 234B was also revised. Thereafter, petitioner preferred application Ext. P3 dated 5-11-1997 to waive interest before Chief Commissioner. He also filed revision under section 264 of Act before Commissioner on 8-12-1998 against Ext. P2 order. Commissioner by impugned order Ext. P6 rejected petition as inadmissible. According to Commissioner, assessment order in which demand arose, has been subject matter of appeal before Commissioner (Appeals) as well as Tribunal. In circumstances, Commissioner held that he cannot statutorily interfere with levy of interest. original petition is against this order. 2. learned counsel for petitioner submits that revision under section 264 is maintainable against any order by subordinate officer and that his appeals were against assessment orders. He could not have raised issue of interest and same could be raised only before revisional authority. I am unable to accept said stand. order in appeal before appellate authority as well as before Tribunal comprises order relating to interest under section 234B. It is integral part of assessment and appellate orders as admitted in original petition itself. Therefore, statutory revision under section 264 cannot be sustained against interest. However, petitioner has preferred waiver application Ext. P3 by invoking powers of Commissioner. said application is still pending. In above circumstances, I do not find any illegality in order passed by Commissioner. However, without prejudice to right of petitioner, if any, to pursue his waiver application Ext. P3, this original petition is disposed of. Madan B. Lokur, J. - revenue is aggrieved by order dated 31-1- 2006 passed by Income-tax Appellate Tribunal, Delhi Bench in respect of batch of appeals filed by group of assessees called Bansal Group. 2. Search and seizure operations under section 132(1) of Income-tax Act, 1961 (for short Act) were conducted on 11-9-2001 at various residential and business premises of group of assessees, including assessee before us, collectively called Bansal Group. Thereafter, proceedings were initiated against assessee under section 158BC of Act. Assessing Officer made huge additions and these additions were, by and large, confirmed by Commissioner of Income-tax (Appeals) [CIT(A)]. Tribunal set aside orders of CIT(A) and that is why revenue is before us. Since facts of all cases are more or less similar, they were dealt with by Tribunal by one order and we do same. 3. Two issues have been canvassed before us: firstly with regard to unexplained payment of commission and secondly with regard to excess stock of goods found in searched premises. 4. There is no dispute that search and seizure operation was conducted on 11th/12th September, 2001. Nothing incriminating was found during course of search except books of account of assessee and revenue wanted to verify their correctness. Accordingly, on 25-9-2001, Deputy Director of Income-tax recorded statement of one V.P. Jain. According to V.P. Jain, he had made purchases of Rs. 25 crores from Bansal Group out of which delivery was made only to extent of about Rs. 2 or Rs. 3 crores. In respect of balance Rs. 22 or Rs. 23 crores, no material or steel wires were purchased and only bills were issued. assessee on its part showed sales having been made in cash. allegation is that V.P. Jain received commission for giving these bills. 5. Subsequently, it appears that V.P. Jain retracted his statement and, therefore, another statement of V.P. Jain was recorded on 14-12-2001 when he w s cross-examined by one of members of Bansal Group. In his statement recorded on 14-12-2001, V.P. Jain stated that goods were directly sent to his customers and, therefore, he (V.P. Jain) did not physically receive goods in his shop. V.P. Jain stated that he had received no commission from Bansal Group but amounts received only represented cash receipts in respect of sales effected. 6. Assessing Officer was of view that V.P. Jain was only preparing false bills for Bansal Group for which he received commission. Therefore, Assessing Officer added back some amounts in accounts of assessee. 7. principal contention urged by assessee before Tribunal, and which was accepted, was that during course of search, no evidence was found of any bogus payments. Under these circumstances, provisions of Chapter XIV-B of Act were not at all applicable. statements of V.P. Jain were post-search statements having no direct nexus with search and they could not have been relied upon for purposes of proceedings under section 158BC of Act. 8. As we understand it, in respect of block assessment, undisclosed income is required to be computed on basis of evidence found during search or being directly relatable to evidence found during search. In present case, nothing was found during search which would suggest that books maintained by assessee were unreliable. It is only subsequent to search and with view to verify correctness of books that Deputy Director of Income-tax recorded statement of V.P. Jain. Whatever be merits or demerits of both statements of V.P. Jain, unless they could be directly connected with recovery of any incriminating material during search, they cannot be used against assessee. 9. In CIT v. Ravi Kant Jain [2001] 250 ITR 1411, this Court laid down law with regard to special procedure contemplated by Chapter XIV-B of Act. It was held as follows: "The special procedure of Chapter XIV-B is intended to provide mode of assessment of undisclosed income, which has been detected as result of search. As statutory provisions go to show, it is not intended to be substitute for regular assessment. Its scope and ambit is limited in that sense to materials unearthed during search. It is in addition to regular assessment already done or to be done. assessment for block period can only be done on basis of evidence found as result of search or requisition of books o f account or documents and such other materials or information as are available with Assessing Officer. Evidence found as result of search is clearly relatable to sections 132 and 132A." (p. 145) 10. Similarly, in CIT v. Elegant Homes (P.) Ltd. [2003] 259 ITR 2322, Rajasthan High Court held: ". . . In Chapter XIV-B of Act, special provisions for assessment in search cases have been given and if any amount of income has not been taxed and during course of search, if some undisclosed income is found on basis of material seized, that should be treated as undisclosed income as per scheme of special assessment under aforesaid Chapter." (p. 235) 11. view expressed by this Court in Ravi Kant Jains case (supra) is, of course, binding on us and we have also followed view expressed by Rajasthan High Court in Elegant Homes (P.) Ltd.s case (supra). In CIT v. Jupiter Builders (P.) Ltd. [2006] 287 ITR 2873, this Court reiterated law that undisclosed income must be unearthed as result of search. This is what was said on report: "26. Assessment proceedings undertaken under Chapter XIV-B are only in respect of undisclosed income that is that income which has not been, or would not have been disclosed and which has been unearthed as result of search or requisition. 27. Assessment proceedings under Chapter XIV-B are not concerned with that income which has already been disclosed and in respect of which regular assessment proceedings stand concluded or are still pending, or in respect of which time for filing of return has not expired on date of search/requisition and which stand recorded in books of account on date of search. proceedings under Chapter XIV-B cannot be used as opportunity to either reopen concluded assessments or to reassess returned income by taking fresh look at disclosed facts and figures, unless, of course, they are found to be false as result of search or requisition." (p. 298) 12. In view of above, we are clearly of opinion that in absence of any incriminating material found during search conducted on 11th/12th September, 2001 in premises of Bansal Group, statement of V.P. J i n recorded on 25-9-2001 and on 14-12-2001 could not be used for proceedings under Chapter XIV-B of Act. 13. Reliance was placed by learned counsel for revenue on statement of V.P. Jain recorded on 25-9-2001. That statement was recorded after search proceedings and appears to have been recorded only with view to confirm correctness of account books. It is not as if statement was recorded during search proceedings nor is it case of revenue that because of some incriminating material that was unearthed during search proceedings that it became necessary to record statement of V.P. Jain. It cannot, therefore, be said that statement of V.P. Jain was direct consequence or result of obtaining some incriminating material which showed that assessee had undisclosed income. 14. Quite apart from above, we also find that statement of V.P. Jain was recorded behind back of assessee. When assessee was in fact allowed to cross-examine V.P. Jain, after his second statement was recorded on 14-12-2001, V.P. Jain had retracted from his earlier statement. Assessing Officer, nevertheless, relied upon statement given by V.P. Jain on 25-9-2001 completely disregarding his subsequent statement. 15. Under these circumstances, we are of view that revenue has not been able to raise any substantial question of law which would necessitate admission of this appeal. 16. second question urged before Tribunal and before us relates to excess stock being found during course of search. assessee is engaged in manufacture of mild steel galvanized iron wires. wires are stacked in bundles and they apparently run into thousands of bundles. search party did not physically count bundles (as it was not possible) but took visual estimate. There was also no actual weighment of goods and weight of stock was taken on estimate basis. As result of this exercise, it was found that there was discrepancy in inventory as shown in books and inventory as found during course of search proceedings. 17. assessee sought to explain this and contended that making estimate of number of bundles and estimating weight of goods visually is totally inadequate. It was contended by assessee that different bundles have different weight and it cannot be said with any degree of certainty that average weight of goods was 65 kg. per bundle. That entire exercise was estimate is confirmed by CIT(A) who arrived at average weight at 60 kg. per bundle. Similarly, in respect of fine wire products, Assessing Officer took average weight at 20 kg. per bundle and this was reduced by CIT(A) to 16 kg. per bundle. This fact is being mentioned only to show that both Assessing Officer as well as CIT(A) made guess with regard to average weight of each bundle. Assessing Officer as well as CIT(A) took into consideration fact that employees of assessee accompanying search party did not raise any objection when estimates were made and in fact they signed panchnama indicating number of bundles and average weight. 18. Tribunal came to conclusion, with which we agree, that it would have been appropriate if number of bundles and average weight was worked out on some empirical basis rather than through mere guess work. It appears that during search, number of bundles and weight estimate in respect of half dozen business concerns were made within few hours. search party either did not have necessary time or did not have necessary expertise to correctly assess stock position. short cut appears to have been taken by search party which came to certain conclusion on estimate basis. In law, as in life, short cut is often wrong cut. 19. mere fact that some employees of assessee signed panchnama does not mean that they certified correctness of number of bundles or average weight of each bundle. They only certified that they were witnesses to proceedings. What conclusions have to be drawn from panchnama is of no concern to those employees. 20. Of course, best method of determining number of bundles and t h e i r average weight would be to actually count bundles and use machines/cranes for weighing each bundle. This is no doubt tedious exercise but where liability is sought to be foisted upon assessee, revenue has to be little more serious while exercising powers conferred upon it under Act. Mere guess work or estimate cannot be adequate substitute for scientific investigation or carrying out some empirical study. officers who conducted search did not want to take necessary trouble which, of course, would have been time consuming, but impact of making guesstimate can be quite damaging insofar as assessee is concerned. assessee cannot be made to suffer consequences of lethargy on part of officers of revenue. 21. Under these circumstances, we are of opinion that Tribunal rightly came to conclusion that alleged excess stock calculated by revenue needs to be deleted. It is, of course, not possible today to redetermine stock so question of any remand does not arise. 22. In our view, no substantial question of law arises. Dismissed. *** Gallium Industries Ltd. v. Deputy Commissioner of Income-tax, Circle-12(1), New Delhi