TMI Blog2001 (5) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and version of the excise authorities. The petitioner replied to the show cause which was ultimately heard by the Asstt. Collector of Central Excise and held that the "hot rolled rods" were excisable to Central excise duty w.e.f. 26th March, 1970, by order dt. 28th Aug., 1972. AR the Central excise authorities right up to the Central Board did not accept the petitioner's contention. So a writ petition was filed by the petitioner in this Court being C.R. No. 8372(W) of 1978. On this writ petition an interim order was passed staying the operation of all the orders of the excise authorities till the disposal of the rule. Meanwhile, two notices to show cause dt. 9th Dec., 1976, and 24th Aug., 1978, were issued to the-petitioner by the Superintendent of Central Excise demanding payment of Central excise duty amounting to Rs.3,11,62,220.72 and Rs.1,05,20,682.63 on the said "hot rolled rods" for the period from 26th March, 1970, to 30th Sept., 1976, and 1st Oct., 1976, to 31st July, 1978, respectively. 3. The aforesaid dispute of excisability being the subject-matter of the writ petition was once attempted to be settled by the petitioner in view of the judgment of the Supreme Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ched its finality right up to the Supreme Court in view of dismissal of the special leave petition. As the petitioner was not granted relief for deduction of the excise duty on the above goods manufactured during the previous years in relation to the asst. yrs. 197172 to 1975-76 in April/May, 1984, it filed five several applications for revision under s. 264 of the said Act before the CIT. It was contended in the applications for revision while explaining the delay that the right to apply for revision accrued only on 15th March, 1984, when the CIT(A) decided finally that the petitioner is entitled to get deduction for the previous year referable to the asst. yr. 1977-78. As such following the earlier decision of the High Court and the Tribunal which had reached its finality in view of dismissal of the special leave petition preferred by the Revenue, the petitioner is entitled to deduction. However, the revising authority, viz., the CIT, rejected the said applications under s. 264 holding in substance that-- (i) there was inordinate delay in filing the applications; (ii) though the petitioner had been granted deduction for the asst. yr. 1977-78 in respect of the disputed statut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he has relied on a decision of the Supreme Court in Union of India vs. Kamakshi Finance Corporation Ltd. AIR 1992 SC 711. Moreover, when the special leave petition which was ultimately filed and dismissed by the Supreme Court there is no embargo to pass appropriate orders in this matter. The law is well settled in this matter that where an assessee follows the mercantile system of accounting a deduction in respect of a statutory liability is to be allowed on accrual basis, irrespective of whether a provision has been made for the same in the accounts and the assessee has disputed and not paid the same. In support of his submission, he has relied on two decisions rendered in Kedarnath Jute Mfg Co. Ltd. vs. CIT (1971) 82 ITR 363 (SC): TC 16R. 668 and CIT vs. Century Enka Ltd. He contends that the petitioner admittedly maintains the mercantile system of accounting and it has been accepted by the AO in the orders passed in a number of assessment years. 6. Mr. Som, learned lawyer appearing on behalf of the respondent, contends that the order passed by respondent No. I is perfectly justified under the law. He in his discretion has refused to condone the delay. Therefore, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n a perusal of the impugned order I do not find that the revising authority has made any attempt to find out whether the petitioner was prevented by sufficient cause from making the application within the prescribed period. A particular fact and/or set of facts may or may not be a sufficient cause and for that matter assessment and evaluation of sufficiency of the cause may vary from one person to another and such evaluation cannot be judicially reviewed by any Court unless of course there is a binding authority and/or precedent on the question of sufficient cause on a given particular fact. If no a ttempt is made to find whether any sufficient cause has been made out or not, it would be a case of failure to exercise jurisdiction. It is settled law that the question of failure to exercise jurisdiction is amenable to judicial review. So, while enquiring into this aspect I find that the petitioner should have made the revision application against the order of the AO quite some time back but it could not do so in view of the facts mentioned in the applications of the petitioner. It is stated in the petitions that the petitioner could not make the application in view of the fact that o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13. Under the provision of s. 14 of the Limitation Act in a civil proceeding the time taken for unsuccessful proceeding with a particular civil litigation is always excluded and ignored so much so the litigant can approach before the appropriate forum for appropriate remedy. Therefore, I hold in this case the CIT first of all ought to have looked into the aforesaid position of the law before holding that the petitioner has caused inordinate delay in taking out this application. I hold that there exists sufficient cause by which the petitioner was prevented from taking out this application for revision as the petitioner proceeded hona fide with the appeal previously before the CIT(A) till 15th March, 1984, and thereafter before the Tribunal when the cross-objection was withdrawn. 14. On the merits it appears that the CIT has misdirected himself by not following the decision rendered by this Court and since being affirmed by the Supreme Court on dismissal of the special leave petition on the same point of law and fact, but in relation to the different assessment years. Since on an earlier occasion the CIT(A) has held in relation to the previous years referable to the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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