TMI Blog2012 (2) TMI 412X X X X Extracts X X X X X X X X Extracts X X X X ..... (Judicial Member).-The appeal filed by the Revenue is against the order of the Commissioner of Income-tax (Appeals)-II, Ludhiana, dated March 28, 2008, relating to the assessment year 2004-05 against the order passed under section 143(3) of the Income-tax Act, 1961. The Revenue has raised the following grounds of appeal : "1. The learned Commissioner of Income-tax (Appeals)-II, Ludhiana has erred both in law and on facts in deleting the addition of Rs.1,22,65,105 and Rs. 8,70,314 on account of profit on the alleged inaccurate sale and on account of unexplained investment respectively made by the Assessing Officer. Further the additional evidence filed during the course of appellate proceedings were entertained without discussing the same in the order passed by the learned Commissioner of Income-tax (Appeals) under the rule 46A. 2. The learned Commissioner of Income-tax (Appeals)-II, Ludhiana, has erred both in law and on facts by ignoring the statement of Sh. Kulbhushan Kumar Jain, director of the company recorded during the inspection made by the customs and Central excise authority which was subsequently retracted, whereas such retraction is contrary to the judgment of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... figure of production, was rejected by the Assessing Officer in view of the finding of the Central Excise Department during its investigation at the manufacturing unit of the assessee and also the statement of the director of assessee-company. The Assessing Officer accordingly applying the ratio of profit of 35.09 per cent. to the unaccounted sales of Rs. 3.49 crores worked out unaccounted profit earned by the assessee at Rs. 1,22,65,105, which was added it to the income of the assessee. Further addition of Rs. 8,70,314 was made on account of unaccounted investment in the purchase of raw material for the said output. Before the Commissioner of Income-tax (Appeals), the assessee moved an application for admission of additional evidence under rule 46A of the Income-tax Rules, which was admitted by the Commissioner of Incometax (Appeals). Further contention of the learned authorised representative for the assessee before the Commissioner of Income-tax (Appeals) was that it was maintaining the quantum records in respect of the purchases of raw material, its consumption and production and also was maintaining dayto-day stock register, which was under the control and check of the excis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise authorities and statement of the director could not be sustained. The Commissioner of Income-tax (Appeals) also considered the additional evidence filed by the assessee in the form of certificate of chartered engineer filed before the excise authorities in January, 2004 in establishing the claim of the assessee that the capacity of the furnace was only 3 m.t. Consequently additions of Rs. 1,22,65,105 and Rs. 8,70,314 were deleted by the Commissioner of Income-tax (Appeals). The Revenue is in appeal against the aforesaid deletion of additions made in the hands of the assessee. The learned authorised representative for the assessee at the outset pointed out that the assessee had filed an appeal against the order of the Commissioner of Central Excise, Ludhiana before the Customs, Excise and Service Tax Appellate Tribunal and vide order passed in appeal No. E/884 and 885/2006 (date of hearing September 6, 2011) the hon'ble Tribunal has held that there was no evidence found to show either suppression of purchase of input or clandestine removal of goods. The learned authorised representative for the assessee further pointed out that even in the case of sister concern, Arora Alloy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capacity of furnace. The Central and Excise Department had computed the suppressed production and the same was the basis for making the addition in the hands of the assessee by the Assessing Officer. The Assessing Officer had applied gross profit rate of 35.09 per cent. to the unaccounted sales to determine the unaccounted profit earned by the assessee at Rs. 1,22,65,105 and also unaccounted investment in the purchase of raw material was worked out at Rs. 8,70,314. The assessee had filed an appeal against the order of the Commissioner of Income-tax, Customs and Excise, before the Customs, Excise and Service Tax Appellate Tribunal with principal Bench at New Delhi (supra). The copy of the order of the Customs, Excise and Service Tax Appellate Tribunal is placed on record by the learned authorised representative for the assessee. The Customs, Excise and Service Tax Appellate Tribunal after considering the factual aspects of the case, the quantum of production, the consumption of electricity observed that there is nothing on record to show that high power connection supported by evidence was made on a particular date and that resulted in higher amount of production. It was further o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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