Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Mahaveer Steel Re-Rolling Mills Versus The Asst. Commissioner of Income Ta x, Circle-2, Aurangabad and Vica-Versa

2016 (5) TMI 420 - ITAT PUNE

Suppression of production on account of electricity consumption - rejection of books of account - GP rate application - Held that:- As during the year under consideration, neither investigation by the DGCEI nor any suppressed production has been detected and admitted by the assessee. Further, the assessee has not moved any petition before the Settlement Commission or any other Excise authorities. In the totality of the above said facts and circumstances and in the absence of any evidence collect .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nt of electricity consumption. In the totality of the above said facts and circumstances, we delete addition made in the hands of assessee by the CIT(A) to the extent of 4% of the said alleged production. Accordingly, ground of appeal raised by the assessee against rejection of books of account and confirming the addition made on account of suppression of production by applying GP rate of 4% on the alleged production of sale are allowed. - Decided in favour of assessee - ITA No.1882/PN/2014, ITA .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

following grounds of appeal:- 1. The learned Commissioner of Income Tax (Appeal) failed to appreciate that the assessment order passed by the assessing officer is bad in law and the same may please be cancelled. 2. The learned Commissioner of Income Tax (Appeal) failed to appreciate that, the assessing officer erred in rejecting the books of accounts u/s 145(1) of the Income Tax Act, 1961 and it is prayed that profit arrived from Audited Books of Accounts may please be accepted. 3. The learned .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

o the excise department, only on the basis of electricity consumption Clandestine sales are calculated by excise department and as such the addition made by the A.O. is not legally sustainable. 5. Appellant craves to add, alter, amend, delete the grounds of appeal and to raise additional grounds of appeal or to withdraw any grounds of appeal. 3. The Revenue in ITA No.2037/PN/2014 has raised the following grounds of appeal:- 1. On the facts and in the circumstances of the case and in law, the Ld. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

restored and that of the CIT(A) be vacated. 4. The appellant craves leave to add, amend or alter any grounds of appeal. 4. The learned Authorized Representative for the assessee at the outset pointed out that the issue in the present appeals is squarely covered by the order of Tribunal in assessee s own case relating to assessment years 2004- 05 to 2008-09 in ITA Nos. 1072 to 1076/PN/2012 in the appeals filed by the assessee and ITA Nos.1446 to 1450/PN/2012 in the appeals filed by the Revenue, v .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ressed sales, which was worked out by the Assessing Officer on the basis of electricity consumption as in the case of other Re-Rolling Mills. 5. The learned Departmental Representative for the Revenue fairly admitted that the issue is covered by the order of Tribunal in assessee s own case and other cases of Re-Rolling Mills. 6. We have heard the rival contentions and perused the record. We find that the issue in the present appeal is squarely covered by the order of Tribunal dated 05.03.2015 in .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ssee on account of alleged suppression of production on account of variation in consumption of electricity arose vide bunch of appeals decided by the Tribunal of both furnace cases and Re-Rolling Mills. The Tribunal in the case of Shree Om Rolling Mills Pvt. Ltd. Vs. Addl. CIT in ITA Nos.125 & 127/PN/2012, relating to assessment years 2007-08 & 2008-09 i.e. appeals filed by the assessee and ITA Nos.430 & 431/PN/2012, relating to assessment years 2007-08 & 2008-09 i.e. appeals fil .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e case of SRJ Peety Steel Pvt. Ltd. (supra). Though both the parties have raised their arguments in favour of/against the order of the Tribunal in SRJ Peety Steel Pvt. Ltd. (supra), we first refer to the decision of the Tribunal and then meet with the respective objections of both the authorized representatives. 55. While arguing the appeals in the lead case of Shree Om Rolling Mills Pvt. Ltd. on 05.05.2015, the Ld. Special AR filed written Note and made elaborate submissions and took us through .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

SRJ Peety Steels Pvt. Ltd. (supra) and found that the arguments raised by the Ld. Special AR in the case of the present assessee before us were repeated by the Ld. Special AR. Though the case of the learned Authorized Representative for the assessee was that the issue raised in the present appeal was identical to the issue before the Tribunal in M/s. SRJ Peety Steels Pvt. Ltd. (supra). However, the Ld. Special AR stressed that the issue was at variance and made elaborate submissions. It may be p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

aid order of CCE, Aurangabad before the CESTAT and the Third Member of CESTAT deleted the addition made in the hands of respective furnace cases. However, in the case of the assessee before us, there is no order of CCE, Aurangabad and there is no order of CESTAT. In some of the years, the own ers of Rolling Mills on the basis of certain information gathered by the DGCEI had moved a petition before the Settlement Commission and offered additional income, which was accepted by the Settlement Commi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of variance in consumption of electricity versus production. The Assessing Officer also referred to the data collected in the cases of furnace owners i.e. M/s. SRJ Peety Steels Pvt. Ltd. and others and relying on the addition made in the hands of M/s. SRJ Peety Steels Pvt. Ltd. (supra), in turn, on the basis of the order of CCE, Aurangabad, made additions in the hands of present set of assesses before us. 56. The Tribunal had elaborately considered all the aspects of addition in the hands of th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

lement Commission in respect of clandestine removal of material without payment of Excise duty, was also considered by the Tribunal and in the absence of any inquiry / investigation or material collected by the Assessing Officer, the Tribunal held that there was no merit in any addition in the hands of the assessee in assessment year 2007-08. Further, in assessment year 2008-09, there was no admission of any clandestine removal of material without payment of Excise duty before the Settlement Com .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

hat the entire value of alleged suppressed production/sales of Ingots and Billets cannot be treated as income of the assessee and some reasonable percentage of the gross profit is to be estimated. Ld. CIT(A), accordingly, directed the Assessing Officer to adopt gross profit @ 4% on the value of alleged suppressed production/sales and accordingly, partly sustained the additions. Now, we first decide the core issue in this case - (i) On the facts and circumstances of this case whether the Assessin .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

also summarizing the submissions of the Ld. Special AR in paras 11 to 11.6 at pages 16 to 22 and the rejoinder of the assessee in paras 12 to 12.1 at pages 22 to 24 of the order, the Tribunal observed as under:- 13. We have heard the rival submissions of the parties and perused the record. Ld. AR for the assessee filed argument synopsis and Ld. Spl. AR for the Revenue also has filed notes of his argument on 05-11-2014 which are placed on record. We have also considered all the precedents and de .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

on the basis of the alleged suppression of the production/sales by the assessee as in his opinion the assessee should have declared or shown more production of the Ingot/Billets. Subsequently, on the basis of the information received from the office of the CCE, Aurangabad vide their letter dated 29-03-2010 as well as adjudication order of CCE quantifying the value of alleged suppressed production and alleged evasion of excise duty, the Assessing Officer initiated the re-assessment proceedings fo .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

lved in the trading into the Ingot/Billets and TMT Bars. The Assessing Officer also referred to the petition filed by the assessee before the Central Excise and Custom Settlement Commission, Mumbai Bench, Mumbai for waiver of penalty, interest and for getting immunity from a prosecution. The Assessing Officer proceeded to decide the alleged suppression of production by the assessee admittedly which was based on the information received from Central Excise Authority as well as the adjudication Or .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ng that the assessee has suppressed the production as compared to the consumption of the electricity. No excess stock of finished goods was also found. We also put on record that the assessment framed by the Assessing Officer in consequence of search and seizure action against the assessee u/s. 153A r.w.s. 143(3) have reached the Hon'ble jurisdictional High Court. We will later refer to the decision of the Tribunal as well as Hon'ble High Court and certain important observations made in .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r the Assessing Officer has placed his reliance only on the information received from the Central Excise Authorities and the proceeding before the Settlement Commission of Central Excise & Custom, Mumbai. The investigation was carried out by Central Excise Authorities i.e. DGCEI, against few brokers/sub-brokers and those brokers gave the names of many companies who are in the manufacturing of Ingot/Billets and TMT Bars. As per the statement given before the Central Excise Authorities by thos .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ched their destination. As noted by the Assessing Officer those brokers/sub-brokers also admitted that the entire evidence was destroyed by them and they used to get the commission of ₹ 100/- per MT. The Assessing Officer has discussed the information gathered by the DGCEI, Zonal Unit, Mumbai in Para Nos. 2.1, 2.2, 2.3, 2.4, 2.5, 2.6 & 2.7 of the assessment order. So far as action against the brokers and sub-brokers are concerned the Central Excise Authority issued show cause to the as .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t of Shri Surendra S. Peety, Managing Director of the assessee recorded on 12-01-2007, by the DGCEI who allegedly admitted that the goods supplied to Shri Om Rolling Mills Pvt. Ltd. i.e. Ingots/ Billets, were removed clandestinely without payment of excise duty and the said material was to extent of 275 MTs. The sale price was received in cash from Shri Om Rolling Mills Pvt. Ltd. and hence, there was no accounting. The assessee admitted the said charge of the Central Excise Authorities i.e. DGCE .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t order. At this stage we are not concerned with the said discussion which is in Para No. 4.1 of the assessment order. The Assessing Officer in his discussion for arriving at the conclusion that as compared to the consumption of the electricity shown by the assessee the production was much more lower, has given the examples or reference of some other manufacturers against whom action taken by the Central Excise authorities. As observed by the Assessing Officer as per an article written by Shri R .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of M.S. Ingots where melting scrap is used as an input, varies from 555 to 754 units and where Sponge Iron is used as an input, the electricity requirement varies from 815 to 1046 units. The Assessing Officer, therefore, came to the conclusion that the assessment framed by the Commissioner of Central Excise and Custom, Aurangabad in respect of the alleged suppression of production after considering the electricity consumption declared by the assessee and the production rate of units of electric .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rmined by the CCE, Aurangabad as per his adjudication order and held that the assessee has suppressed the production and accordingly, worked the suppressed production of the A.Y. 2007 -08 as under: A.Y. Suppressed Production M.T. Rate per M.T. Rs. Assessable Value of Suppressed Production Rs. 2007-08 20,751 18,892 39,20,37,546 2008-09 29,276 21,444 40,75,72,486 18. In the A.Y. 2007 -08, the Assessing Officer gave the set off of ₹ 8,44,01,504/- which was in respect of the addition made by t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

is of the order passed by the Commissioner of Central Excise and Custom, Aurangabad as per the value determined in the adjudication order for the purpose of levy of excise duty adopting statistic of power consumption. In the computation for the A.Y. 2008 - 09 the Assessing Officer made the mistakes by mentioning Rs. (-) 1,91,62,000/- as per the order u/s. 143(3) when in fact the said figure is as per the return of income filed by the assessee for the A.Y. 2008 - 09. 58. After analyzing the submi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

turn, relying on the ratio laid down in R.A. Casting (supra). The relevant finding of the Tribunal in turn, incorporating the order of Third Member of CESTAT in paras 19 to 19.4, which read as under: - 19. In sum and substance in both the assessment years the Assessing Officer has determined alleged suppression of the production/sales as determined the Commissioner of Central Excise and Custom, Aurangabad on the basis of power consumption. The copy of the adjudication order passed by the Commiss .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

duction is much more than cost of sale value, leaving no room for other major expenses like stores, wages, salaries, cost of maintenance etc. The Ld. Commissioner has referred to the study conducted by the Indian Institute of Technology (IIT), Kanpur and has observed that as per the said Technical Opinion Report the consumption of electricity for manufacture of one metric ton of steel ingots varies between 555 to 1026 electricity units depending upon the thermal efficiency, electricity efficienc .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

there is a huge difference in the actual/normal production and the recorded figures in the assessee s records. The Ld. CCE accordingly, observed that the assessee has willfully suppressed the figures of production of Billets/MS Ingots in their records with an intent to evade payment of Central Excise Duty and, have involved themselves in the clandestine removal of final products. He also referred to the show cause notice issued by the DGCEI to the assessee which matter was ultimately settled by .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

bad. The Ld. Commissioner observed that the said Dr. N.K. Batra was no more and hence, his cross examination was not possible. He has also discussed and referred to the different decisions of the Tribunal. The Ld. Commissioner also relied on the investigation made by the DGCEI and show cause notice issued to the assessee and how the assessee approached the Settlement Commission and admitted the evasion and paid the excise duty and obtained immunity from criminal proceedings. The Ld. Commissioner .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

w of the discussion in Para 1 to 31 and in view of the decision of the Tribunal in the case of R.A. Castings Pvt. Ltd. (supra) the impugned orders are to be set aside and the appeal allowed. b. Whether in view of the discussion in Para 32 to 68 above and in view of the Hon'ble Supreme Court s judgment in the case of Triveni Rubber & Plastics (supra) and this Tribunal s decision in the case of Rattan Steels Works (supra), Nagpal Steel (supra) and Hans Castings Pvt. Ltd. (supra), the impug .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ts of the instant appeals. In R.A, Casting the electricity consumption was 2072 to 2443 units per MT, which is higher than the average electricity consumption in the instant appeals. 20.1 The Commissioner in the orders impugned in the instant appeals was having the following reports and clarifications for his consideration- (i). 555 to 1046 units PMT as per Dr. Batra's report; (ii). 1800 units PMT as per the report by Joint Plant Committee constituted by the Ministry of Steel, Government of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Furnace], (vi). 620 to 690 units/MT as per Letter dated 22,6.2008 from Electrotherm, (vii). Letter dated 9.8.2008 of Electrotherm to a client suggesting reasons which lead to high powerconsumption, and another Letter dated 5.4.2008 of Electrotherm agreeing-., with .the views of Induction Furnace "Association and informing that it is very difficult to define any range of power consumption. 20.2 As against this, in para 20 of the Order, the Tribunal in R.A. Casting (supra) considered differe .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

shney); (v). 851 units/MT in the case of Nagpal Steel v. CCE, Chandigarh reported in 2000 (125) E.LT. 1147, 20.3 After perusal of these reports, Tribunal opined that wide variations in the consumption electricity have been reported for the manufacture of one MT of steel ingot&, and that this renders the norm of 1046 units adopted by the Revenue as arbitrary. After this finding, which is upheld by the Hon'ble Allahabad High Court and even SLP has been dismissed, there was no reason for th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

loss over last 4-5 years, which was economically and commercially not possible, (iii). generation of fictitious profits in the balance sheets by depositing huge amount of cash with the stock brokers and receiving cheques of profits against the cash so deposited, (iv). Claim of High Auxiliary load of about 35%, However the Tribunal in categorical terms held that no demand can be upheld based on electricity consumption as such because the clandestine manufacture and removal of excisable goods is t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the stock of raw materials and final products; (iv). Clandestine removal of goods with reference to entry of vehicle/truck in the factory premises, loading of goods therein, security gate records, transporters' documents, such as L.Rs, statements of lorry drivers, entries at different check posts, forms of the Commercial Tax Department and the receipt by the consignees; (v). Amount received from the consignees, statement of the consignees, receipts of sale proceeds by the consignor and its d .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

hich was economically and commercially not possible, c). Discrepancies in financial accounts in some cases and/or any proceedings under Income Tax, d). Claim of higher Auxiliary load, e). Past case settled before Settlement Commission, 20.7 So far as the proceedings already settled are concerned, the Commissioner is hot relying on the same and the findings of the Commissioner, as recorded earlier, have not been challenged by the Revenue. All these other allegations were also levelled in R.A. Cas .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

authorities have been held to be unsustainable in law and set aside* and the Revenue had been directed to carry out experiments in different factories on different dates to arrive at the average to be adopted as a norm, which can be followed thereafter and the Revenue in the present case not having conducted any experiment whatsoever cannot be permitted to justify the demands raised. It will be appropriate on the part of the Revenue to conduct experiments in the factory of the appellants and oth .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

venue to discharge its onus, the impugned order cannot be sustained." 20.8 In the present appeals, none of the so called other evidences referred in the impugned Orders prove clandestine clearance. The primary evidence of department is admittedly excess electricity consumption based on benchmark adopted allegedly-'from report of Dr. Batra, which was already held to be arbitrary by Hon'ble Tribunal in RA casting (supra). Thus, in my opinion the primary evidence relied in the impugned .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

lls Pvt. Ltd., V/s. CCE, Hyderabad-II, 2005 (184) ELT 263, however the same was also considered in R.A. Casting (supra). It has been contention of the department that the Department is not required to prove its case to its mathematical precision, by relying on judgment of the Hon'ble Supreme Court in the case of D. Bhoormull - 1983 (13) ELT 1546 (SC), relied upon by the Commissioner as well as the Hon'ble Member (Technical). It is seen that even this judgment was considered in R.A. Casti .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

uot; basis to sustain the findings in the impugned Orders by assuming that there could not be any reason for lower consumption of electricity during the subsequent period. I also agree with the finding of the Hon'ble Vice President that in. any event, this additional material is also only of power consumption. 22. In written submissions of Revenue, it has also been contended that Report of JPC suggesting electricity consumption upto 1800 its PMT was for electric arc furnace and not induction .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of the Hon'ble Supreme Court in the case of Melton India V/s. The Commissioner Trade Tax, U.P, - 2007-TIOL-14-SC-CT, the judgment of the Hon'ble Gujarat High Court in the case of Rajmoti Industries V/s. Joint Commissioner of Income Tax, 2014-TIOL-203-HC-AHM-IT, and an unreported order dtd. 28/9/2010 of Andhra Pradesh Sales Tax Tribunal (Visakhapatnam Bench) in the case of Venkata Raimana Stone Crushers Company V/s. State of Andhra Pradesh. In the case of Melton India (supra), for the no .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

de fluctuations in the productivity as compared to that in A.Y. 2004 -05, but also because the assessee therein had not recorded the work-inprogress in the books of accounts. I am therefore of the opinion that these cases, apart from being under Statutes other than Central Excise Act, do not any manner help in sustaining the findings recorded in the impugned Order. In none of these cases any theoretical repot was relied for arriving at deemed production. 24. Further, in Sarvana Alloys Steels Pvt .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

emoval. 25. I therefore concur with the findings of the Hon'ble Vice President and in my opinion, the judgment in R.A. Casting (supra) would be squarely applicable in the facts of the instant case in all the appeals. 19.4 The common order was passed by the CESTAT on 30 -07-2006 as per the majority opinion allowing the appeals filed by the assessee and other appellant companies. The copy of the majority order is placed at Page Nos. 5 and 6 of the P/B - VI. It is pertinent to note here that th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t is clear that both the assessments are merely based on the alleged suppression of the production by estimating certain consumption of electricity i.e. 1026 Units for manufacturing of 1 MT of Ingots and Billets. Moreover, even if in the A.Y. 2008 -09, the Assessing Officer has observed that the information received from the Central Excise Authorities has no bearing in the said order but on the perusal of the said order, it is seen that entire order is copy of order passed for the A.Y. 2007-08. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

egal order. This plea of the Ld. Special AR was rejected by the Tribunal in view of the decision of Third Member of the CESTAT. 60. Another objection raised by the Ld. Special AR was with reference to the order of Settlement Commission passed in the case of set of companies. The Tribunal noted that the CCE, Aurangabad in its order had taken into consideration the said material while determining the value of alleged suppressed production and had made observations vide para 19. The relevant observ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

TMT Bars show cause notice was issued to the assessee company and matter was settled. Ld. CCE, Aurangabad in his order has taken in to consideration said matter while determining the value of the alleged suppressed production and has observed as under: 19. There are other instances of central excise violations detected by other agencies where the assessee was found to be involved. In one instance that assessee had approached the Settlement Commission, admitted the evasion offence of an identical .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sue that no independent investigation was made by the Revenue, but the entire assessment was framed on the basis of information received from the Central Excise Department as well as the adjudication order passed by the CCE, Aurangabad, which in turn, had been cancelled by the Third Member of CESTAT. The Tribunal thus, held that the foundation for assessment does not exist. It was also noted by the Tribunal in para 21 that the investigation by the DGCEI and proceedings before the Settlement Comm .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of the Ld. Special AR and upheld the arguments of learned Authorized Representative for the assessee that the order of CESTAT had to be applied. The relevant para of the Tribunal order reads as under:- 21. Though the Ld. Spl. AR has referred to and relied on the different judgments of the Hon'ble Supreme Court more particularly on the binding nature of the admission of any person-Sec. 17, Sec. 106 and Sec. 115 of the Indian Evidence Act etc. but the fact remains that in the case of the pres .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

. The law is also well settled that when the assessee files an appeal challenging an order of the lower authority before the higher appellate authority then the entire order gets merged with the order of the higher appellate forum which in the present case is CESTAT. Moreover, investigation by DGCEI and proceeding before the Settlement Commission has also been considered by the CCE, Aurangabad in his adjudication order. The said order was subject matter before the CESTAT and said order has been .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of the Ld. CCE, Aurangabad. Ld. AR vehemently argued to point out how the order of the CESTAT, Mumbai Bench, Mumbai is not correct. The CESTAT is a higher appellate forum under the Custom Act 1962 and Central Excise Act 1944 and we cannot sit as revisionary authority or make any observation whether that order is right or wrong. 63. The Tribunal held that CESTAT was an appellate forum under the Customs Act, 1962 and Central Excise Act, 1954 and the Tribunal (Income - tax) could not act as revisio .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

J Peety Steels Pvt. Ltd. (supra) referred to the observations of Tribunal in earlier proceedings relating to assessment years 2000-01 to 2006-07 under section 153A r.w.s 143(3) of the Act and held that in the said case of search and seizure, it was also held that the consumption of electricity for the manufacture of mild steel, ingots / billets depending on various factors and there was no justification to charge the assessee that it had suppressed the production and indulged into unaccounted pr .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

in-above that in the case of the assesse, the search and seizure operation was carried out u/s. 132(1) of the Income-tax Act on 17-03-2006 and accordingly the assessment orders for the A.Ys. 2000-01 to 2006-07 were framed u/s. 153A r.w.s. 143(3) of the Act. Th e Assessing Officer rejected the books of account of the assessee for the A.Ys. 2000-01 to 2006-07 and one of the reasons was that alleged suppressed production which was computed on the basis of consumption of the electricity. The Assessi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nce the Assessing Officer had simply taken the lowest electricity consumption for a month in a whole year and accordingly worked out the total production as per his formula and on the basis of the formula he worked out the alleged concealed income. There are certain important observations and findings of the Tribunal which are as under: 31. In the present case, the search was initiated on 17th March, 2006 in the residential and business premises of SRJ Peety Group, Jalna covering the premises of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

h of the year under consideration was very well placed before the authorities below in the director s report of each year. The same has not been disputed by the Revenue. The tax audit report also contained the unit production of each year which were accepted year after year along with the returns and no query was ever raised by the Department. The following chart shows the year-wise production vis-a-vis electricity consumption which has been placed before the authorities below along with the ret .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ion were before the Department. If the Department had any doubts regarding the same, it could have been raised during the regular assessments and not in the assessment proceedings under s. 153A of the Act. When nothing incriminating was found in the course of search relating to any of these assessment years, the assessments for such years could not be disturbed on this ground. 33. In view of above factual and legal position we find that the additions in question in asst. yrs. 2000-01 to 2005-06 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the Act, according to which in case the AO is not satisfied about the correctness or completeness of accounts of the assessee or where no method of accounting provided in sub-s. (1) or accounting standards as notified under sub-s. (2), have not been regularly followed by the assessee, the AO may make an assessment in the manner provided in s. 144. Sec. 145 gives the power to AO to reject the books in certain circumstances after considering the following aspects: (a) Whether the assessee has regu .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

me for each year under consideration. The AO could not substitute the same by cogent reasoning. He has simply taken the lowest electricity consumption for a month in the whole year and treated the production in that month as the correct production and then proceeded to arrive at his production figure by multiplying the production in the books by the ratio of production to the electricity consumption for the month in which electricity consumption was minimum. The method of computing the so-called .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

direct nexus between the production and electricity consumed for the manufacture of round/TMT bars and arrived at a conclusion that there is an excess consumption of electricity resulting in suppressed production and alleging that the assessee company has indulged in unaccounted production. 37. None of the evidence collected as a result of search or detected during the course of assessment pertains to the asst. yrs. 2000-01 to 2005-06. It is an accepted fact that each year of the assessment is .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

unal in assessee s own case in the search and seizure matter as it is held that the consumption of electricity for the manufacturing of mild steel ingots/billets depends on various factors and there was no justification to charge the assessee that the assessee has suppressed the production and indulged into unaccounted production. The order of the Tribunal was challenged by the Department before the Hon'ble High Court of Bombay Bench at Aurangabad by filing the appeal u/s. 260A of the Income .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

6 in the residential and business premises of SRJ Peety Steels Pvt. Ltd. Prior to the search, the returns of the income for the assessment year 2000-01 to 2005-06 had already been filed u/s. 139(1) of the Act, accompanies by all requisite documents and proceedings. The scrutiny was thus completed. During the course of search, no incriminating material was found relating to the said years, which could have been added in the proceedings u/s. 153A. The details regarding the consumption of electrici .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

icity, therefore, was held to be one, and since details were made available to the Department, which could have been raised during the course of regular assessment and not u/s. 153A of the Act. The finding is that nothing incriminating was found in the course of search relating to these assessment years. The additions, therefore, were not corresponding to the seized material during the course of search. The relevant income tax returns, in normal course, are disclosing the particulars. They were .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ld not justified. 24. Ld. Spl. AR for the Revenue argues that the said observations are made in the context of the assessment framed in consequence of search and seizure operation. We are not inclined to accept the argument of the Ld. Spl AR for the reason that even if the assessments are framed in consequence of the search and seizure operation but the important fact remains that nothing was found during the course of search except few loose sheets found in the residence of the Director to make .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

itions based on consumption of electricity. 65. The Tribunal vide para 24 took note of the fact that in assessment years 2007-08 and 2008-09, no investigation was done by the Revenue after the search and seizure operations in the immediately preceding year, wherein during the course of search, certain loose sheets were found in the residence of the Director to make out case against the assessee for alleged suppression of production / sales. The Tribunal while deciding the appeal in M/s. SRJ Peet .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

en matter reached before the Tribunal and it is held as under: 10. The assessee had filed an appeal against the order of CIT Customs & Excise, before the Customs, Excise & Service Tax Appellate Tribunal with principal Bench at New Delhi (supra). The copy of the order of the Customs, Excise & Service Tax Appellate Tribunal is placed on record by the learned A.R. for the assessee. The Customs, Excise & Service Tax Appellate Tribunal after considering the factual aspects of the case .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

presence of witness. The Customs, Excise & Service Tax Appellate Tribunal held that therefore, a hypothetical case appears to have been made by Revenue in excessive exercise of its jurisdiction to the detriment of justice. The Customs, Excise & Service Tax Appellate Tribunal further considered the retraction statement of the Director of the assessee company and vide para 6 held as under: "6. We would have certainly come to the rescue of Revenue had the statement been recorded in a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e electricity consumption could not be criteria to determine the output laid down in R.A. Castings, where the appeal of the Revenue was dismissed by the Hon'ble Apex Court as reported in 2011 (269) ELT A -108 (SC). The basis for the addition in the present case was the investigation report of the Central Excise Department and the suppression in production calculated by the said Investigating Team. The Assessing Officer had completely based its addition on the aforesaid report of the Investig .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s. In view of the aforesaid findings of the Customs, Excise & Service Tax Appellate Tribunal in assessee's own case there is no merit in any addition being made in the hands of the assessee on account of the alleged suppression in production and also alleged investment in purchase of raw material. In view thereof, we hold that no addition on account of profit on the sale of unaccounted production or on account of unexplained investment merits to be made in the hands of the assessee. We a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nsumption to produce 1 MT of Ingots. The confessional statement was also given by the Managing Director of the said company before the Central Excise Authorities. The Ld. CIT(A) allowed the assessee s appeal. The Revenue challenged the order of Ld. CIT(A) before the Tribunal. It was held that there was no justification to support the said addition and the Revenue s appeal was dismissed. In the light of our above discussion, we are of the opinion that the additions made by the Assessing Officer a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s no merit in the rejection of books of account and application of gross profit to determine the income in the hands of the assessee. The Tribunal also gave a finding that since the additions made in the hands of the assessee have been deleted, there was no merit in any addition on account of undisclosed investment in respect of the undisclosed turnover. The Tribunal vide paras 27 to 29 held as under: - 27. The next issue is the rejection of books of account by the Assessing Officer in both the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

in making the additions towards alleged suppression of production/sales. We, therefore, hold that the rejection of the books of account on above reason cannot be upheld. We, accordingly, allow Ground No. 7 in the A.Y. 2007-08 and Ground No. 5 in the A.Y. 2008 -09. 28. The next issue is the percentage of the gross profit estimated by the Ld. CIT(A) on the alleged suppressed sales and said issue arises from Ground No. 9 in the A.Y. 2007 -08 and Ground No. 7 in the A.Y. 2008-09 are on. As the asses .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sed turnover of the half period of the earlier year under appeal. The Ld. CIT(A) has observed that the undisclosed sale for the earliest year under appeal are of ₹ 39,20,36,546/- and the said investment required for production out of books, therefore, worked out ₹ 37,69,582/-. In fact, the said addition is made by the Ld. CIT(A) as he has confirmed the alleged suppression of production/sales as held by the Assessing Officer. As the assessee has succeeded in getting the relief by dele .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n by the assessee on the alleged suppression of the production/sales. As the assessee has succeeded on the basic additions, the grounds taken by the Revenue do not survive as the entire additions are deleted in both the assessment years by allowing the grounds taken by the assessee. Accordingly, all the grounds of the Revenue in both appeals are dismissed. 68. The plea of the learned Authorized Representative for the assessee before us was that the issue raised in the present appeal is squarely .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f the Ld. Special AR is sheer waste of process of law, wherein the submissions made before the Tribunal in M/s. SRJ Peety Steels Pvt. Ltd. (supra) have been verbatim repeated in the appeal filed against the assessee before us i.e. Shree Om Rolling Mills Pvt. Ltd. 69. We find that the Assessing Officer in the present case before us had made the addition on account of erratic consumption of electricity based on the consumption of electricity as per US standards. The Assessing Officer had not adopt .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

is of erratic consumption of electricity vis-à-vis the consumption as per US standards after giving benefit of 25%. Following the same line of reasoning as in the order of M/s. SRJ Peety Steels Pvt. Ltd. (supra), we find no merit in the addition made in the hands of the assessee on surmises. Both the learned Authorized Representative for the assessee and Ld. Special AR by way of written submissions has raised identical arguments as in M/s. SRJ Peety Steels Pvt. Ltd. (supra) and since the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

laneous Application filed by the Revenue in M/s. SRJ Peety Steels Pvt. Ltd. (supra) was also fixed for hearing and the same was heard on 19.06.2015. We have by an order of even date dismissed the Miscellaneous Application filed by the Revenue in M/s. SRJ Peety Steels Pvt. Ltd. (supra) after considering the submissions of both the Authorized Representatives. We have by an order of even date held that there is no merit in the said Miscellaneous Application filed by the Revenue and no remedy is ava .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

15 had applied the ratio laid down by the Tribunal in M/s. SRJ Peety Steels Pvt. Ltd. (supra) and held that the addition made towards alleged suppressed production and sales on the basis of consumption of electricity was deleted. In our opinion, the addition made by the Assessing Officer by relying on the consumption of electricity under US standards, by no stretch of imagination, can be applied under Indian conditions, in the absence of any finding that the conditions for carrying out manufactu .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ddition could be upheld in the hands of the assessee by extrapolating the sales for period of 300 days. The Ld. Special AR for the said proposition relied on the decision of the Tribunal in assessee s own case relating to assessment year 2006-07. The case of the Revenue before us was that where the assessee had admitted to clandestine removal of material without payment of Excise duty before the Settlement Commission for part of the period, then in view of the order of the Settlement Commission .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

without payment of Excise duty and approached the Settlement Commission for payment of Excise duty on the said amount. The Settlement Commission accepted the petition of the assessee, but also levied penalty of ₹ 9,000/-. The assessee before the Assessing Officer admitted that the additional income in respect of the said clandestine removal of material without payment of Excise duty, is to be added in the hands of the assessee. All this information was available before the Assessing Office .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

andicap of 25% was given. The Assessing Officer applying the formula worked out the suppressed production and sales in the hands of the assessee. We in the paras hereinabove have already adjudicated the issue that no addition on account of suppressed production / sales on account of such formula could be made in the hands of the assessee. The Ld. Special AR on the other hand, stressed that where the Assessing Officer had the information of alleged clandestine removal of material without payment .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

odology of suppression, the addition in the hands of the assessee could be sustained on the basis of extrapolation of sales for 300 days, in view of the admission of the assessee of clandestine removal of material without payment of Excise duty and suppression of income. 73. The evidence of clandestine removal of material without payment of Excise duty was detected by the Excise authorities during the course of search and seizure operation on certain brokers, however, no search and seizure opera .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

claimants, the authorities have the power to re-visit the offer made by the claimant and where any adverse material is available against the person making the offer, then the figures of settlement can be increased. However, in the case of the assessee, offer of the assessee has been accepted for the financial year and the same cannot be said to be restricted to the number of days for which it was offered. The basis of any settlement is the offer made by the claimant and/or the evidence found ag .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ce found against the assessee for the balance period. 74. Another aspect of the issue is that though the factum of the assessee filing the petition before the Settlement Commission, was before the Assessing Officer, even additional income on such offer of settlement was offered by the assessee before the Assessing Officer, however, no further inquiry, investigation or action was taken by Assessing Officer in this regard. In the absence of the same, the issue raised in the present appeal is wheth .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ition in the hands of the assessee was made on the basis of search and seizure action carried out by the Income-tax Department and the documents found during the course of search, which were admitted by the assessee to reflect suppression of sales. On the basis of aforesaid documents, the income for the year was extrapolated, which order of the Tribunal was approved by the Hon ble Bombay High Court. However, for the year under consideration, there was no search and seizure operation carried out .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

petition by the assessee before the Settlement Commission. The perusal of the assessment order and the order of CIT(A) reflects no such basis was adopted for making the addition in the hands of the assessee. The sole basis on which the addition in the hands of the assessee made was on account of erratic consumption of electricity. Undoubtedly, both the aspects i.e. the petition made by the assessee before the Settlement Commission pursuant to search conducted by the DGCEI and also the other bas .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

as carried out by the Assessing Officer and merely on the basis of petition filed before the Settlement Commission, which in turn has been accepted, no further addition can be made in the hands of the assessee in the absence of any incriminating material found for the balance period. 76. Reliance in this regard is placed upon the ratio laid down in Ravi Foods Pvt. Ltd. Vs. CCE, Hyderabad (supra). In the facts of the said case, certain documents were found by the Income-tax Department pursuant to .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

possession of the assessee by the Excise authorities. 77. Following the same analogy of reasoning, where the evidence of clandestine removal of material without payment of Excise duty has been found by the Excise Department, in respect of sale of goods for a particular quantity and for a particular period, the same could not be relied upon as evidence, while extrapolating the sales and the additional income thereon in the hands of the assessee during the Income-tax proceedings. The Assessing Of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s only by way of the additional income offered by the assessee, which was relatable to the clandestine removal of material without payment of Excise duty admitted before the DGCEI and offered by way of petition before the Settlement Commission. No statement of Directors of the assessee company was recorded either by Assessing Officer or CIT(A) during the course of assessment proceeding. Accordingly, we find no merit in the reliance placed upon by the Ld. Special AR in this regard. The addition a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

and CIT(A) had not made the addition in the hands of the assessee on the basis of petition filed before the Settlement Commission, but had adopted the erratic consumption of electricity as basis to make the addition, we have adjudicated the alternate plea raised by the Ld. Special AR in this regard and dismissed the same. 80. Now, we come to the reliance placed upon by both the Authorized Representatives in support of individual proposition vis-à-vis the addition on account of extrapolati .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d vide the said settlement and no inference could be drawn against the assessee for extrapolating the same for full year and for the balance year and in other years, other than the year in which the said settlement was offered. In this regard, we find support from the ratio laid down by the Bangalore Bench of Tribunal in Anjaneya Brick Works vs. CIT (supra), wherein it has been held that mere existence of evidence of concealment in the next assessment year could not be the basis for estimating i .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e search had been conducted after the accounting year and the books of account had brought some discrepancy. 83. Similar proposition has been laid down by the Hon ble Bombay High Court in CIT Vs. C.J. Shah and Co. (supra). 84. Further, the Bilaspur Bench of the Tribunal in Chattisgarh Steel Casting Pvt. Ltd. V. ACIT (supra) decided similar issue of the information available with the Central Excise Department, wherein unaccounted sales was estimated for 56 days and the Assessing Officer estimated .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

mation of gross profit merely on guess work and presumption was not sustainable in law. No details were available to the Assessing Officer to arrive at such figure or had there been any concealed sales for 9 months, it could have been detected by the Central Excise authority during their search operations. Therefore, the addition made by the Assessing Officer is purely based on guess work, presumption and surmises and not on the basis of any material found during the course of search operation c .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ourse of arguments before the Tribunal in Miscellaneous Application filed in M/s. SRJ Peety Steels Pvt. Ltd. vide MA No.17/PN/2015 had raised the issue of extrapolation of sales for 300 days in view of the assessee having admitted to clandestine removal of material without payment of Excise duty and thereafter, filing a petition before the Settlement Commission. 86. The plea of the Revenue raised in the Miscellaneous Application was rejected as no such plea was taken by the Department during the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ration on certain brokers, evidences of clandestine removal of material without payment of Excise duty, was found against the assessee. However, no search and seizure operation was carried out against the assessee, but the assessee claims that in order to buy peace of mind, it had declared the said amount by way of petition before the Settlement Commission. The said offer made by the assessee was accepted in toto. It may be noted that the Excise authorities have the power to re-visit the offer m .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

be made on account of alleged clandestine removal of goods or suppressed sales, in the absence of evidence for the balance period. The above said ratios have been laid down in Chattisgarh Steel Casting Pvt. Ltd. V. ACIT (supra), Hon ble Bombay High Court in CIT Vs. C.J. Shah & Co. (supra), Hon ble Delhi High Court in CIT Vs. Anand Kumar Deepak Kumar (supra). The Ld. Special AR had placed reliance on the decision of Hon ble Bombay High Court in CIT Vs. Dr.M.K.E. Memon (supra) while arguing th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ooting in contrast to the exercise undertaken by the Assessing Officer under Chapter XIV-B, where the Assessing Officer had to assess only the undisclosed income. However, the Hon ble Bombay High Court further held that under Chapter XIV-B, the Assessing Officer cannot estimate the undisclosed income on an arbitrary basis. We find no merit in the plea raised by the Ld. Special AR in this regard as the facts of the said case are different from the facts of the present case. 42. Even on merits, th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

assessment proceedings against the assessee. Another aspect of the issue is that the petition before the Settlement Commission has been made by the assessee in assessment year 2007-08 only and no such petition for clandestine removal of material without payment of Excise duty has been made for assessment year 2008-09. The assessee had offered the additional income on account of such clandestine removal of goods before the Assessing Officer for assessment year 2007-08 and the same was the reason .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ement Commission, even the Third Member of CESTAT was aware of all these proceedings, but since the settlement petition filed by the assessee had been accepted in toto by the Settlement Commission, no further addition could be made in the hands of the assessee on this ground, in the absence of any inquiry or investigation by the Assessing Officer. Accordingly, the reliance placed upon by the Ld. Special AR in assessee s own case reported in 137 TTJ 627 [Pune] is mis-placed and there is no merit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ing, the Ld. Special AR relied on series of other decisions, but the ratios laid down by the said judgments are distinguishable and not applicable to the facts of the present case. It may be put on record that all these decisions were relied upon by the Ld. Special AR in M/s. SRJ Peety Steels Pvt. Ltd. (supra) and same have already been considered. 88. In the entirety of the above said facts and circumstances, we hold that no extrapolation of sales for 300 days can be made in the hands of the as .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ish the case of the Revenue that the said figures of additional production should be utilized for extrapolating the sales in the hands of the assessee for the entire year. Admittedly, the assessee had offered additional inco me on the said clandestine removal of material without payment of Excise duty, which is to be added as income in the hands of the assessee. The learned Authorized Representative for the assessee fairly admitted that in case the said additional income has not been added while .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of the assessee. We have heard bunch of appeals and in some years, there is no admission of clandestine removal of material without payment of Excise duty and in those years in the absence of any evidence and / or any investigation or inquiry made by the Assessing Officer and where the Assessing Officer has failed to collect additional evidence, no addition can be made in the hands of the assessee, by way of extrapolation of sales for 300 days on account of any evidence found in any preceding o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

payment of Excise duty, next addition made in the hands of the assessee i.e. alleged investment in the purchases for effecting such sales which goods have been clandestinely removed, is not sustainable. Accordingly, we hold that no addition can be made in the hands of the assessee on account of alleged investment in purchases under section 69C of the Act. 7. Thereafter, Corrigendum order dated 17.02.2016 was passed by the Tribunal substituting para 88 of the Tribunal and it was held as under:- 3 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ip;… Admittedly, the assessee had offered additional income on the said clandestine removal of material without payment of Excise duty, which is to be added as income in the hands of the assessee. The learned Authorized Representative for the assessee fairly admitted that in case the said additional income has not been added while computing the income in the hands of the assessee for the respective years, the same may be directed to be added in the hands of the respective assessee in resp .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tional income @ 4% or actual G.P. rate declared by the assessee for that year, whichever is higher, on value of such admitted clandestine removal of material without payment of Excise duty, by the assessee before the Excise authorities. Thus, the assessee is directed to file the requisite details of proceedings before the Excise authorities, before the Assessing Officer in order to compute the additional income in the hands of assessee in the respective years. 8. The issue arising before us iden .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version