Learned counsel for the appellant submitted that in the facts and circumstances of the case no penalty was leviable as the appellant itself had surrendered the said amount representing the difference in the sundry creditors in order to buy peace. He, thus, submitted that there was no concealment of income so as to warrant levy of penalty under Section 271(1)(c) of the Act.
In the present case the notice to show cause under Section 124 was not issued to the Petitioner. The order of adjudication dated 20 September 2007 was similarly not in respect of the Petitioner. The certificates that were issued under Section 142(1)(c)(ii) on 19 March 2010 were in the names of (i) Mehul Exports of which the proprietor is Nirmal Agawal, the spouse of the Petitioner; (ii) Nisum Exports and Finance Private Limited of which the director is stated to be Nirmal Agawal in the certificate; and (iii) Nisum Global Limited of which again the director is stated to be Nirmal Agawal.
Despite filing of the stay application, the direction for recovery makes it mandatory for the authority to recover the amount within a period of 30 days after the filing of the appeal even if there is a stay application pending and has not been disposed of. The plea taken is that the proviso to Section 35-F of the Central Excise Act does not specify any time limit. In such view of the matter, it is pleaded that the circular overreaches the provisions.
As regards investment made in thandal business, there are no materials seized at the time of search of the assessee’s premises, to make this as a subject matter of block assessment. When the revenue does not dispute the fact that the assessee had been doing the business along with two others, there was no justifiable ground to assess Rs. 27 lakhs at the hands of the assessee.
After the search and the statement recorded under section 132(4), the assessee, on being issued with notice under section 153A did not file any return. The notice under section 153A was issued on 20-7-2006. It was only when assessment proceedings were taken up for consideration, did the assessee, by letter dated 14-8-2007, request that its return, filed on 31-10-2005,
Even if it is assumed that the assessee continued to remain the owner of the property throughout the year, the other condition of section 32, that the property should have been used for the purpose of the assessee’s business has not been satisfied. There is no proof that the director resided in the property and it was only a claim made by the assessee in the course of the arguments.
In the present case, the impugned reasons behind the notice dated 28.03.2012, which we have extracted above, does not even carry a whisper that there has been a failure on the part of the assessee to fully and truly disclose all material facts necessary for the assessment. Even the order rejecting the objections does not indicate as to what material fact has not been disclosed by the assessee.
For furnishing information required, the petitioner had sought 5 adjournments, as finds place in the impugned order but such information was not furnished. On 8.3.2001, again an adjournment was sought by the petitioner on the ground that the staff was busy in the examination work so time be allowed for furnishing the information. From the perusal of the aforesaid, it appears that such information was required to be furnished by the petitioner, as the staff of the petitioner was busy in the examination work, petitioner institution had sought such time, but it was denied.
It appears from the company’s admission of January 5, 2011 that it asserted that it owed the petitioner a sum of Rs. 26,08,858/- and it had a claim against the petitioner’s associate concern in the sum of Rs. 22,80,646.05. Even if the letter is taken on face value and the veracity of the assertions therein are not questioned, it appears that there is an unequivocal admission by the company of it being indebted to the petitioner in the sum of Rs. 3,28,211.95 if the two figures of Rs. 26,08,858/- and Rs. 22,80,646.05 are reconciled. It is the same sentiment which is reflected in the company’s affidavit, at paragraph 11 whereof the figures are repeated and the company has questioned the petitioner’s claim only to the extent of the same exceeding Rs. 26,08,858/-.
Last aspect of the matter i.e., the argument as to why yet another Form was filed on 05.04.2004. The conduct of respondent no. 3 in this regard is explained by reference to ROC’s letter dated 26.03.2004, whereby they were advised to file a revised duplicate Form by an authorised person to rectify the objections. It is quite possible that having received the said communication, respondent no.3 filed yet another Form on 05.04.2004.
