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2018 (3) TMI 944 - AT - Income TaxRevision u/s 263 - addition u/s 41 - Held that:- As per order of the Dy. Commissioner, Customs, the assessee is not entitled for refund, hence, the refund received in pursuance of the order of the CESTAT even if be treated as income u/s 41(1) still the net income would be zero since the liability lies to the assessee with the consumer welfare fund subsisted till the Hon’ble Supreme court settled the issue [2002 (9) TMI 4 - SUPREME Court]. Hence, the assessee requires to transfer this amount to consumer welfare fund but not to the income account of the assessee. Therefore, receipt held by the assessee is in fiduciary capacity till such time the issue is finally settled at the level of Hon’ble Supreme Court and he cannot be held to be owner of the asset. Therefore, we hold that in view of the peculiar circumstances exist in the assessee’s case by virtue of the order for the Dy. Commissioner of Customs and Central Excise with regard to the entitlement of the Central Excise refund the same is crystalised in the year of final settlement by Hon’ble Supreme Court, accordingly we hold that the assessee has rightly offered the central excise refund as income for the assessment year 2013-14 and the order of the Commissioner of Income Tax is unsustainable. Accordingly, we set aside the order of the Principal Commissioner of Income Tax passed u/s 263 of the act and allow the appeal of the assessee.
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