Case Law Details
Brief of the Case
ITAT Pune held In the case of M/s. Meta Rolls & Commodities Pvt. Ltd. vs. ACIT that in the instant assessment year i.e. 2010-11, there is no order of Commissioner of Central Excise and Customs and there is no evidence of any clandestine removal of goods without payment of Excise duty, found against the assessee. In the entirety of the above said facts and circumstances, there is no merit in any addition in the hands of assessee.
Facts of the Case
The issue raised in the bunch of appeals is against the addition made on account of suppressed production and sale in the respective hands on the basis of order passed by the Commissioner of Central Excise and Customs, Aurangabad for the earlier years and on the basis of evasion of Excise duty by steel manufacturers in Jalna cluster found by DGCEI for the earlier years.
Contention of the Assessee
The ld counsel of the assessee submitted that The learned Authorized Representative for the assessee at the outset pointed out that the issue raised in the present bunch of appeals is squarely covered by the order of Tribunal in assessee’s own case relating to assessment years 2006-07 to 2008-09 and by separate order of Tribunal relating to assessment year 2009-10.
He further submitted that the issues in these appeals are the addition made on account of alleged suppression of production and sales on the basis of monthly variation in consumption of electricity. The sim ilar addition made in A .Y. 200 6 -07 to 2008 -09 was deleted by the H on. Tribunal vide order dated 05.08.2015. He also submitted that for the captioned assessment year, there was no order of Commissioner of Central Excise and Customs, Aurangabad and no clandestine removal of goods without payment of Excise duty, was found against the assessee in the instant assessment year in the hands of the assessee.
Contention of the Revenue
The ld counsel of the revenue placed reliance on the orders of authorities below and earlier submissions made in the appeals decided by the Tribunal in assessee’s own case.
Held by ITAT
We found that the addition in the hands of assessee was made on the basis of erratic consumption of electricity vis-à-vis production on the basis of Article written by Dr. N.K. Batra, Professor, IIT, Kanpur. No evidence was found against the assessee of having clandestinely removed the goods without payment of Excise duty in the instant assessment year, though in assessment years 2006-07 to 2008-09, the Commissioner of Central Excise and Customs, Aurangabad had passed an order on evasion of Excise duty by the steel manufacturers in Jalna District, in turn found by the DGCEI for the said year. However, the said addition was deleted by the Third Member of CESTAT. Further, in assessment year 2009-10, the Commissioner of Central Excise and Customs has passed an order on the basis of consumption of electricity, which in turn, was deleted by the Division Bench of CESTAT.
The Tribunal in assessee’s own case had heard similar issue in cross appeals vide ITA Nos. 279 to 281/PN/2012 & ITA Nos.408 to 410 /PN/2012, relating to assessment years 2006- 07 to 2008-09 and vide order dated 05.08.2015 had deleted the addition, in the absence of any evidence found by the Income–tax Department against the assessee for the alleged suppressed production and sales and held that there was no merit in the aforesaid addition worked out on the basis of monthly variation in consumption of electricity. Further, in assessment year 2009-10, the Tribunal in ITA No.282/PN/2012 & Ors, vide order dated 05.08.2015 had also deleted the addition, in view of the physical verification having been carried out by the Excise authorities, wherein it was found that there was in fact higher consumption of electricity than the report of Dr. Batra.
In the instant assessment year i.e. 2010-11, there is no order of Commissioner of Central Excise and Customs and there is no evidence of any clandestine removal of goods without payment of Excise duty, found against the assessee. In the entirety of the above said facts and circumstances, there is no merit in any addition in the hands of assessee.
Further, the Tribunal in Bhagyalaxmi Steel Alloys Pvt. Ltd. Vs. ACIT and ACIT Vs. Bhagyalaxmi Steel Alloys Pvt. Ltd. & Ors in ITA No.1292/PN/2012 and 1478/PN/2012 & Ors., relating to assessment year 2009-10, vide order dated 15.07.2015, held that another aspect of the addition is extrapolation of sales to be made in the hands of the assessee for the entire year on the basis information received for part of the year. It may be put on record that in assessment year 2009-10 in the hands of various furnace companies no such investigation was made by DGCEI. In the absence of any information gathered by the Excise Authority of clandestine removal of goods without payment of excise duty, and in the absence of the assessee declaring any additional income in its hand, no such addition is warranted in the hands of the assessee. However, in case any of the assessee have admitted to clandestine removal of goods without payment of excise duty, then additional income relatable to such turnover is to be added in the hands of the said assessee.
Accordingly appeal of the assessee partly allowed.
