Yes it definitely is a bug as I can see that this issue does not appear in ImageMagick-6.7.5-5-Q16.
I will check internally on how to go about this now.
Also can you please help me with some guide to update libtiff?
No, this is not happening with 6.8.8 and another older version 6.6.3.
This happens only in 6.7.4. Anything specific that has changed in this version of IM?
I will attach the source and output to dropbox and paste the link here soon.