TMI Blog2013 (9) TMI 896X X X X Extracts X X X X X X X X Extracts X X X X ..... to inflation of stock issue. However, he has submitted that assessment proceedings under Section 153A read with Section 143(3) are pending and all issues and questions can be thrashed out and decided there. - The submission of the revenue cannot accepted as the petitioners have a right to invoke jurisdiction of the Settlement Commission, which is provided under the statute, i.e., Income Tax Act. The petitioners must come clean and be honest and admit their faults and cannot but declare their true and full undisclosed income. However, their plea and explanation that their declarations are genuine and truthful, cannot be rejected without a legitimate and fair consideration - The matter is remanded to the Settlement commission again. - W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income Tax. The Commissioner submitted reports on 15th February, 2013 and the two petitioners were heard on 22nd February, 2013 and 1st March, 2013. The petitioners had filed written submissions on 28th February, 2013 and 1st March, 2013. 3. The impugned order passed by the Settlement Commission is rather brief and we would like to reproduce paragraphs 4 to 6 of the said order to understand and appreciate the contention of the petitioners. The said paragraphs which record and give reasons for dismissing the applications read as under:- 4. After the admission of both the cases u/s 245D(1) of the IT Act vide order dated 14.1.2013 holding that the applicants have prima facie fulfilled the condition for admission, CIT Central-II, New Delh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ought to be suppressed by the applicant and its C.A. in the audit report. In the case of M/s MARC Bathing Luxuries Ltd. also apart from the suppression of income pointed out by CIT it was also noticed that the applicant had filed Profit Loss Account (actually manufacturing and trading account) which had neither the opening stock nor the closing stock disclosed in the accounts. This appears to be an attempt to complicate the accounts. 6. It is apparent that the applicants have indulged in suppression of Income even before the Settlement Commission where they are required to declare full and true income. The applicants have not come before the Commission with clean hands and have indulged in creative accounting to suppress their income. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore them. The applications have been erronously dismissed by recording and relying upon wrong and factually incorrect findings. 5. The two petitioners were subjected to search under the Central Excise Act, 1944 on 25th September, 2008 and by the Income Tax Department on 26th April, 2010. 6. After the search by the Excise Department, Marc Bathing Luxuries Limited had approached Customs and Central Excise Settlement Commission by way of an application on 30th May, 2011. The said application was disposed of vide order dated 1st November, 2011. In the order passed by the Settlement Commission, unaccounted manufactured items were quantified and valued at Rs.20,11,59,509/-. The Settlement Commission while computing the said amount took the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith some hesitation, we record that the order under challenge is cryptic and is not focused on the issues and contentions, which were raised by the petitioners and by the Commissioner. The Settlement Commission earlier had directed and decided to proceed with the applications on 14th January, 2013 in the two cases. They had set out points, which had to be adjudicated and decided. These included turnover of the two applicants for the assessment years covered, determination of the issues arising out of the stock, including valuation by the Department, allowability of excise duty for the Assessment Year 2009-10 and determination of year-wise additional income. All these factors and facts have been shunned and ignored. The Settlement Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not in the period relevant to the Assessment Year 2012-13. The Settlement Commission s order has not referred to any specific issues and documents or made references to the contentions of the Commissioner. Facts stated are incorrect or that Commissioner had not objected to the stock reduction is not adverted to. May be the applications deserve dismissal for the said reasons but full factual position should be noted, before opinion is formed whether there has been full and true disclosure. There has been error and failure in the decision making process and the failure vitiates the order passed. 13. In view of the aforesaid discussion, we set aside the impugned order dated 1st March, 2013 in the case of the two petitioners and pass an order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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