Dy. CIT Circle-10, Pune V. Veena Industries Ltd., Pune

ITA 1344/PUN/2010

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9506 (ITAT-PUNE)
• Duration Of Justice: 4 year(s) 3 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2015
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 17-12-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 16-11-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A K MODI
• Assessee Lawyers: AJIT TOLANI
• Section: 143(3); 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NOS.283 & 1344/PN/2010 (ASSESSMENT YEARS : 2006-07 & 2007-08) ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE- 10, PUNE. . APPELLANT VS. VEENA INDUSTRIES LTD., S-145, MIDC, BHOSARI, PUNE 411 026. PAN : AAACV9329E . RESPONDENT ITA NOS.1368 & 1369/PN/2012 (ASSESSMENT YEARS : 2005-06 & 2008-09) VEENA INDUSTRIES LTD., 103/104, STELLAR ENCLAVE, NEW D.P. ROAD, AUNDH, PUNE 411 007. PAN : AAACV9329E . APPELLANT VS. INCOME TAX OFFICER, WARD- 10(1), PUNE. . RESPONDENT DEPARTMENT BY : MR. A. K. MODI ASSESSEE BY : MR. VED JAIN & MR. AJIT TOLANI DATE OF HEARING : 20-02-2015 DATE OF PRONOUNCEMENT : 27-02-2015 ORDER PER G. S. PANNU, AM THE CAPTIONED FOUR APPEALS, TWO EACH BY THE REVENUE AND ASSESSEE INVOLVE CERTAIN COMMON ISSUES, THEREFORE THEY HAVE BEEN CLUBBED AND HEARD TOGETHER AND A CONSOLIDATED ORDER IS BEING PASSED F OR THE SAKE OF CONVENIENCE AND BREVITY. 2. ITA NO.283/PN/2010 AND ITA NO.1344/PN/2010 FOR A SSESSMENT YEARS 2006-07 AND 2007-08 ARE APPEALS OF THE REVENUE, WHI CH ARE DIRECTED AGAINST ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEAL S)-V, PUNE DATED 10.11.2009 AND 31.08.2010 WHICH, IN TURN, HAS ARISE N FROM DIFFERENT ASSESSMENT ORDERS DATED 30.12.2008 AND 31.12.2009 R ESPECTIVELY PASSED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT). 3. ITA NO.1368/PN/2010 AND ITA NO.1369/PN/2012 FOR ASSESSMENT YEARS 2005-06 AND 2008-09 ARE APPEALS OF THE ASSESSEE, WH ICH ARE DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEAL S)-V, PUNE DATED 13.04.2012 WHICH, IN TURN, HAS ARISEN FROM ORDERS D ATED 31.12.2010 PASSED BY THE ASSESSING OFFICER U/S 143(3) OF THE ACT. 4. ALTHOUGH THE ASSESSEE AND THE REVENUE HAVE RAISE D MULTIPLE GROUNDS OF APPEAL IN THEIR RESPECTIVE APPEALS BUT THE ISSUE RELATES TO THE CLAIM MADE BY THE ASSESSEE FOR DEDUCTION U/S 80-IB(4) OF THE A CT WITH RESPECT TO THE PROFITS RELATING TO SILVASSA UNIT. THE APPEAL OF THE ASSES SEE IN ITA NO.1368/PN/2012 PERTAINING TO ASSESSMENT YEAR 2005-06 IS TAKEN AS T HE LEAD CASE. IN SO FAR AS THE APPEALS OF THE ASSESSEE FOR ASSESSMENT YEARS 20 05-06 AND 2008-09 ARE CONCERNED, THE ASSESSING OFFICER AND THEREAFTER THE CIT(A) HAVE DENIED ASSESSEES CLAIM FOR DEDUCTION U/S 80-IB(4) OF THE ACT IN RELATION TO THE SILVASSA UNIT. THE APPEALS OF THE REVENUE PERTAINI NG TO THE ASSESSMENT YEAR 2006-07 AND 2007-08 VIDE ITA NO.283/PN/2010 AND ITA NO.1344/PN/2010 RESPECTIVELY ALSO INVOLVE SIMILAR ISSUE. IN THE SA ID TWO ASSESSMENT YEARS, THE ASSESSING OFFICER HAD DENIED ASSESSEES CLAIM FOR D EDUCTION U/S 80-IB OF THE ACT BUT THE SAME WAS ALLOWED BY THE CIT(A) AND HENC E THE APPEALS OF THE REVENUE BEFORE US. 5. AT THE TIME OF HEARING, AT THE OUTSET, IT WAS PO INTED OUT THAT SO FAR AS THE IMPUGNED ASSESSMENT MADE FOR ASSESSMENT YEAR 2005-0 6 IS CONCERNED, THE ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 SAME WAS FINALIZED ON 31.12.2010 AFTER THE ORIGINAL ASSESSMENT MADE U/S 143(3) OF THE ACT DATED 28.12.2007 WAS SET-ASIDE BY THE COMMISSIONER OF INCOME TAX V, PUNE BY INVOKING SECTION 263(1) OF THE ACT DATED 22.03.2010. NOTABLY, FOR ASSESSMENT YEAR 2005-06 IN THE ORIGINA L ASSESSMENT MADE U/S 143(3) DATED 28.12.2007, THE TOTAL INCOME OF THE AS SESSEE WAS ASSESSED AT RS.23,96,480/- WHICH, INTER-ALIA, CONTAINED AN ALLO WANCE OF DEDUCTION U/S 80- IB(4) OF THE ACT OF RS.53,23,307/- RELATING TO THE SILVASSA UNIT. THE AFORESAID ASSESSMENT WAS SET-ASIDE BY THE COMMISSIONER OF INC OME TAX V, PUNE U/S 263(1) OF THE ACT DATED 22.03.2010 WITH DIRECTIONS TO MAKE THE ASSESSMENT DE NOVO . IN THE COURSE OF THE SUCH SET-ASIDE ASSESSMENT, THE ASSESSING OFFICER HAD MADE FURTHER VERIFICATION AND ENQUIRIES RELATIN G TO ASSESSEES CLAIM FOR DEDUCTION U/S 80-IB(4) OF THE ACT WITH RESPECT TO T HE PROFITS FROM THE SILVASSA UNIT. IN THIS CONTEXT, THE RIVAL COUNSELS HAD CONV ERGED THAT THE APPEAL FOR ASSESSMENT YEAR 2005-06 BE TAKEN AS THE LEAD CASE. 6. IN ASSESSMENT YEAR 2005-06, ASSESSEE HAD CLAIMED DEDUCTION U/S 80- IB(4) OF THE ACT IN RESPECT OF SILVASSA UNIT TO THE EXTENT OF RS.53,23,307/-. THE APPELLANT IS A COMPANY INCORPORATED UNDER THE PROVI SIONS OF THE COMPANIES ACT, 1956 AND IS, INTER-ALIA, ENGAGED IN THE BUSINE SS OF FABRICATION, MANUFACTURING AND ASSEMBLING OF CANOPY AND MANUFACT URING/ASSEMBLING OF ELECTRICAL GENSETS. THE ACTIVITIES OF THE ASSESSEE ARE CARRIED OUT AT THREE UNITS, NAMELY, BHOSARI UNIT WHEREIN CUTTING, BENDIN G AND PAINTING OF FABRICATED PARTS, ASSEMBLING OF FABRICATED PARTS OF ATALAS COP CO IS CARRIED OUT. THE SECOND UNIT IS CHAKAN UNIT WHEREIN CUTTING, BENDING , WELDING RELATED TO FABRICATION MANUFACTURING AND ASSEMBLING OF CANOPY TAKES PLACE. THE THIRD UNIT IS SILVASSA UNIT WHEREIN ASSESSEE CLAIMS TO MA NUFACTURE AND ASSEMBLE ELECTRICAL GENERATORS. THE DISPUTE BEFORE US IS IN RELATION TO THE THIRD UNIT I.E. SILVASSA UNIT WHICH ASSESSEE CLAIMS TO BE CARRYING ON THE ACTIVITIES OF THE MANUFACTURING AND ASSEMBLING OF ELECTRICAL GENERATO RS. ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 7. THE ASSESSING OFFICER HAS DENIED THE DEDUCTION U /S 80-IB(4) OF THE ACT PRIMARILY ON TWO COUNTS. FIRSTLY, AS PER THE ASSES SING OFFICER, THE ACTIVITY UNDERTAKEN BY THE ASSESSEE AT THE SILVASSA UNIT IS NEITHER MANUFACTURE AND NOR PRODUCTION OF ANY GOODS OR ARTICLES AS ENVISAGE D IN SECTION 80-IB(4) OF THE ACT AND THEREFORE THE PROFITS DERIVED FROM THE SILV ASSA UNIT ARE NOT ELIGIBLE FOR THE BENEFITS OF SECTION 80-IB(4) OF THE ACT. SECON DLY AND MORE SUBSTANTIVELY THE OBJECTION OF THE ASSESSING OFFICER IS THAT THE ASSESSEE HAS NOT STARTED ITS MANUFACTURING ACTIVITY IN THE SILVASSA UNIT ON OR B EFORE 31.03.2004 AND THEREFORE THE SILVASSA UNIT IS INELIGIBLE FOR THE C LAIM OF DEDUCTION U/S 80-IB(4) OF THE ACT, EVEN IF IT IS ACCEPTED THAT THE UNIT IS EN GAGED IN THE MANUFACTURE OR PRODUCTION OF AN ARTICLE OR THING. ON BOTH THE TWO COUNTS, THE CIT(A) IN ASSESSMENT YEAR 2005-06 HAS AFFIRMED THE STAND OF T HE ASSESSING OFFICER. 8. IN SO FAR AS THE FIRST OBJECTION IS CONCERNED, T HE RELEVANT FACTS ARE AS FOLLOWS. IN SILVASSA UNIT THE ACTIVITY CLAIMED BY THE ASSESSEE IS FOR MANUFACTURING OR PRODUCTION OF ELECTRICAL GENERATOR S. IT WAS EXPLAINED THAT VARIOUS COMPONENTS OR RAW MATERIALS ARE REQUIRED FO R THE MANUFACTURE OF ELECTRICAL GENERATORS, NAMELY, ENGINES, ALTERNATORS , CANOPY, CONTROL PANEL, BATTERIES AND ELECTRICAL ITEMS, ETC.. THE ASSESSEE ALSO POINTED OUT BEFORE THE LOWER AUTHORITIES THE PROCESS INVOLVED IN THE AFORE SAID MANUFACTURE OR PRODUCTION OF GENERATORS IS AS FOLLOWS (I) INSPEC TION/ TESTING OF EVERY EMPTY CANOPY; (II) INSPECTION/ TESTING OF EVERY ENGINE; (III) INSPECTION/ TESTING OF EVERY ALTERNATOR OR COUPLING; (IV) ASSEMBLING AND C OUPLING OF THE ALTERNATOR TO THE ENGINE; (V) PLACING OF THE ENGINE AND ALTERNATO R IN AN EMPTY CANOPY; (VI) AFFIXING THE CLADDING TO THE SILENCER BOX; (VII) AF FIXING CANOPY ROOF AND CLADDED SILENCER TO ENGINE AND ALTERNATOR; (VIII) I NSPECTION AND TESTING OF CONTROL PANEL; (IX) ASSEMBLING THE CONTROL PANEL TO THE ENGINE COUPLED WITH ALTERNATOR; (X) INSPECTION AND TESTING OF EXHAUST L INE ITEMS; (XI) ASSEMBLING OF THE EXHAUST LINE TO THE ENGINE AND ALTERNATOR; (XII ) INSPECTION AND TESTING OF ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 AIR CLEANER LINE ITEMS; (XIII) ASSEMBLING OF AIR LI NES TO ENGINE AND ALTERNATOR; (XIV) INSPECTION AND ASSEMBLING OF FUEL LINE ITEMS; (XV) INSPECTION AND ASSEMBLING OF ELECTRICAL ITEMS; (XVI) FINAL DIMENSI ONAL AND VISUAL INSPECTION OF THE GENSET MANUFACTURED; AND, (XVII) FUNCTIONAL TES TING OF EACH GENSET. ON THE AFORESAID BASIS, THE CLAIM OF THE ASSESSEE IS T HAT THE ACTIVITY UNDERTAKEN BY THE ASSESSEE TANTAMOUNTS TO MANUFACTURE OR PRODU CTION OF GENERATORS AND THEREFORE IT IS ELIGIBLE FOR THE SECTION 80-IB(4) B ENEFITS. AT THE TIME OF HEARING, THE LD. REPRESENTATIVE FOR THE ASSESSEE HAS RELIED UPON THE FOLLOWING JUDGEMENTS : (I) ASPINWALL AND CO. LTD. VS. CIT, (2 001) 251 ITR 323 (SC); (II) S.S.M. BROTHERS (P.) LTD. VS. CIT, 243 ITR 418; (II I) COMPUTER GRAPHIC LTD. VS. ACIT, (2009) 318 ITR 96 (MAD.); AND (IV) CIT VS. TA TA LOCOMOTIVE AND ENGINEERING COMPANY LIMITED, 68 ITR 325 (BOM.) TO C ONTEND THAT THE ACTIVITY OF THE ASSESSEE AMOUNTS TO MANUFACTURE OR PRODUCTIO N. APART FROM THE AFORESAID, IT WAS ALSO SUBMITTED THAT A SIMILAR ACT IVITY WAS CONSIDERED BY THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. JAC KSON ENGINEERS LTD. VIDE ITA NO.251 OF 2008 DATED 23.12.2009 AND HELD TO BE A MANUFACTURING ACTIVITY, A COPY OF THE SAID JUDGEMENT HAS ALSO BEEN PLACED O N RECORD. 9. ON THIS ASPECT, THE LD. CIT-DR HAS RELIED UPON T HE ORDER OF THE AUTHORITIES BELOW TO SAY THAT AN ACTIVITY INVOLVING ASSEMBLING OF VARIOUS COMPONENTS WOULD NOT AMOUNT TO MANUFACTURE OR PRODU CTION WITHIN THE MEANING OF SECTION 80-IB OF THE ACT. 10. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS WITH RESPECT TO THE OBJECTION OF THE ASSESSING OFFICER THAT THE ACTIVIT Y UNDERTAKEN BY THE ASSESSEE AT SILVASSA UNIT RELATING TO THE GENERATORS DOES NO T AMOUNT TO MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING. IN OUR CONSIDE RED OPINION, THE AFORESAID ISSUE IS DIRECTLY COVERED BY THE JUDGEMENT OF THE H ONBLE DELHI HIGH COURT IN THE CASE OF JACKSON ENGINEERS LTD. (SUPRA). AS PER THE HONBLE DELHI HIGH ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 COURT, THE ACTIVITY INVOLVING ASSEMBLING OF VARIOUS COMPONENTS AND ACHIEVING A FINAL PRODUCT OF A GENERATOR AMOUNTS TO MANUFACTU RE OR PRODUCTION OF AN ARTICLE OR THING WITHIN THE MEANING OF SECTION 80-I B OF THE ACT. MOREOVER, THE HONBLE BOMBAY HIGH COURT IN THE CASE OF TATA LOCOM OTIVE AND ENGINEERING COMPANY LIMITED (SUPRA) HAS ALSO HELD THAT ASSEMBLI NG OF VARIOUS COMPONENTS WHICH RESULTS INTO A DIFFERENT PRODUCT W HICH IS DISTINCT THEN THE INDIVIDUAL COMPONENTS, SUCH AN ACTIVITY AMOUNTS TO MANUFACTURE OR PRODUCTION. AS A CONSEQUENCE, WE THEREFORE DO NOT AGREE WITH TH E FIRST OBJECTION OF THE ASSESSING OFFICER TO DENY ASSESSEES CLAIM FOR DEDU CTION U/S 80-IB(4) OF THE ACT. THUS, ON THIS ASPECT ASSESSEE SUCCEEDS. 11. THE SECOND OBJECTION RAISED BY THE ASSESSING OF FICER IS THAT THE SILVASSA UNIT OF THE ASSESSEE DID NOT BEGIN TO MANU FACTURE OR PRODUCE THE GENERATORS BEFORE 31.03.2004. THE AFORESAID OBJECT ION OF THE ASSESSING OFFICER IS ON ACCOUNT OF THE PROVISO TO SECTION 80- IB(4) OF THE ACT WHICH PRESCRIBES OUTER LIMIT FOR BEGINNING MANUFACTURE OR PRODUCTION SO AS TO ENTITLE ASSESSEES UNDERTAKING FOR THE BENEFITS OF SECTION 80-IB(4) OF THE ACT. AS PER THE PROVISO TO SECTION 80-IB(4) OF THE ACT, THE IND USTRIAL UNDERTAKING OF THE ASSESSEE OUGHT TO BEGIN TO MANUFACTURE OR PRODUCE A RTICLE OR THINGS BEFORE 31.03.2004. IN-FACT, THE EFFECTIVE DATE I.E. 31.03 .2004 DOES NOT FALL WITHIN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION WHICH IS FROM 01.04.2004 TO 31.03.2005. THE CLAIM OF THE AS SESSEE WAS THAT THE SILVASSA UNIT OF THE ASSESSEE HAD STARTED MANUFACTU RING BEFORE 31.03.2004 AND IN-FACT ASSESSMENT YEAR 2004-05 IS FIRST OF THE TEN CONSECUTIVE ASSESSMENT YEARS FOR WHICH THE BENEFITS OF SECTION 80-IB(4) OF THE ACT ARE AVAILABLE TO IT. NOTABLY, THE DEDUCTION U/S 80-IB( 4) OF THE ACT IS AVAILABLE TO AN INDUSTRIAL UNDERTAKING FOR TEN CONSECUTIVE ASSESSME NT YEARS BEGINNING WITH THE INITIAL ASSESSMENT YEAR WHICH IS UNDERSTOOD TO MEAN THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH THE INDUSTRI AL UNDERTAKING BEGINS TO ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 MANUFACTURE OR PRODUCE ARTICLES OR THINGS. THE CLA IM OF THE ASSESSEE IS THAT THE SILVASSA UNIT BEGAN TO MANUFACTURE AND ASSEMBLE GENERATORS IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2004- 05 AND THEREFORE THE PRECEDING ASSESSMENT YEAR 2004-05 WAS THE INITIAL A SSESSMENT YEAR. SO HOWEVER, IT WAS NOTICED THAT SO FAR AS THE ASSESSME NT YEAR 2004-05 IS CONCERNED, THE ASSESSEE DID NOT STAKE ITS CLAIM FOR DEDUCTION U/S 80-IB(4) OF THE ACT AND THEREFORE, THERE WAS NO OCCASION FOR TH E REVENUE TO HAVE EXAMINED THE CONDITION THAT THE INDUSTRIAL UNDERTAK ING OF THE ASSESSEE STARTED MANUFACTURING OR PRODUCING ARTICLE OR THINGS BEFORE 31.03.2004; THEREFORE, IT IS IN ASSESSMENT YEAR 2005-06 WHEREIN ASSESSEE MADE A CLAIM FOR DEDUCTION U/S 80-IB(4) OF THE ACT OF RS.53,23,307/- THAT THE ASSE SSING OFFICER HAS CARRIED OUT A VERIFICATION EXERCISE TO EXAMINE COMPLIANCE WITH THE CONDITION OF BEGINNING OF PRODUCTION ON OR BEFORE 31.03.2004. 12. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE AS SESSING OFFICER SHOW- CAUSED THE ASSESSEE TO JUSTIFY THE DEDUCTION CLAIME D U/S 80-IB(4) OF THE ACT AS TO WHETHER SILVASSA UNIT HAD STARTED MANUFACTURING ACTIVITY ON OR BEFORE 31.03.2004. THE ASSESSING OFFICER HAD REQUIRED THE ASSESSEE TO PRODUCE EVIDENCES IN THE SHAPE OF LABOUR CHARGES PAID WITH RECEIPTS, INSTALLATION CERTIFICATE IN RESPECT OF FIRST ELECTRICITY BILL, F IRST SALE TAX RETURN, RENTAL AGREEMENT OF SILVASSA UNIT, MACHINERY INSTALLED AT SILVASSA U NIT, COPY OF REGISTRATION UNDER EXCISE ACT, SALES TAX, INDUSTRIES ACT AS MANUFACTUR ER, PROOF IN RESPECT OF EXCISE DUTY PAID ON THE PRODUCTS, COPIES OF TRANSPO RT BILLS, PURCHASE BILLS, OCTROI BILLS, INVOICES IN RESPECT OF VARIOUS COMPONENTS SU CH AS ENGINE, ALTERNATORS, ETC. REQUIRED TO MAKE GENSETS, DETAILS OF TDS MADE ON LABOUR CHARGES PAID WITH TDS LEDGER AND COPY OF TDS RETURN FILED, IF AN Y TO DEMONSTRATE THAT THE MANUFACTURE AND PRODUCTION HAD BEGAN ON OR BEFORE 3 1.03.2004. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER ALSO ISSUED REQUISITIONS TO M/S KAVITA INDUSTRIES PVT. LTD. AND M/S SNA INDUSTRIES, BOTH SISTER CONCERNS OF THE ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 ASSESSEE WHO CLAIMED TO HAVE DEALT WITH THE SILVASS A UNIT OF THE ASSESSEE BEFORE 31.03.2004. PRESENTLY, THE CLAIM OF THE ASS ESSEE WAS THAT THE SILVASSA UNIT HAD MANUFACTURED CERTAIN GENSETS, AND ONE UNIT WAS SOLD TO ITS SISTER CONCERN M/S SNA INDUSTRIES, CHAKAN, PUNE BEFORE 31. 03.2004. THE ASSESSEE HAD ALSO CLAIMED BEFORE THE ASSESSING OFFICER THAT M/S KAVITA INDUSTRIES PVT. LTD. HAD SUPPLIED RAW MATERIAL TO THE SILVASSA UNIT BEFORE 31.03.2004 APART FROM THE SUPPLIES RECEIVED FROM MAHINDRA & MAHINDRA LTD.. THE ASSESSING OFFICER NOTES THAT IN RESPONSE TO REQUISITION ISSUE D TO M/S KAVITA INDUSTRIES PVT. LTD. AND M/S SNA INDUSTRIES, THE FOLLOWING WAS FURNISHED :- I) PURCHASE INVOICE AND DELIVERY CHALLAN. II) TRANSPORT BILL NUMBERS 130 & 132 PERTAINING TO KAVITA INDUSTRIES PVT. LTD. AND SNA INDUSTRIES RESPECTIVELY ISSUED BY PADWAL TRANSPORT, TELCO ROAD, BHOSARI, PUNE BEARING DETAIL S AS UNDER : II-A) BILL NO.130 DATED 28.03.2004 VEHICLE NO.MH 14 F 3444 TO CONSIGNOR KAVITA INDUSTRIES PVT. LTD. ISSUED BY PAD WAL TRANSPORT. II-B) BILL NO.132 DATED 30.03.2004 VEHICLE NO.MH 14 F 3444 TO CONSIGNOR VEENA INDUSTRIES, SILVASSA ISSUED BY PADW AL TRANSPORT. 13. ON THE BASIS OF THE AFORESAID INFORMATION, THE ASSESSING OFFICER ISSUED A REQUISITION U/S 133(6) OF THE ACT TO M/S PADWAL T RANSPORT WHO WAS STATED TO HAVE TRANSPORTED RAW MATERIAL FROM M/S KAVITA INDUS TRIES PVT. LTD., CHAKAN, PUNE, TO ASSESSEES PREMISES AT SILVASSA AND ALSO T RANSPORTED THE FINISHED GOODS BACK TO M/S SNA INDUSTRIES, CHAKAN. THE ASSE SSING OFFICER NOTES THAT IN RESPONSE TO HIS REQUISITION, SHRI MANIK SOPAN PA DWAL, PROPRIETOR OF M/S PADWAL TRANSPORT FURNISHED A REPLY DATED 10.12.2010 WHEREIN HE DENIED TRANSPORTING RAW MATERIALS FROM M/S KAVITA INDUSTRI ES PVT. LTD., CHAKAN, PUNE TO ASSESSEES SILVASSA UNIT AS ALSO THE TRANSPORTAT ION OF THE GOODS FROM ASSESSEES SILVASSA UNIT TO M/S SNA INDUSTRIES, CHA KAN, PUNE. THE STATEMENT OF SHRI MANIK SOPAN PADWAL WAS ALSO RECOR DED BY THE ASSESSING OFFICER ON 10.12.2010, WHOSE RELEVANT PORTION HAS B EEN REPRODUCED BY THE ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 ASSESSING OFFICER IN THE ASSESSMENT ORDER ITSELF. IN ONE OF THE QUESTIONS PUT TO HIM THE TRANSPORTER SUBMITTED THAT BILL NO.132 OF M /S PADWAL TRANSPORT CLAIMED TO BE ISSUED BY HIM WAS FABRICATED BY THE O THER PARTY I.E. ASSESSEE. SIMILARLY, WITH REGARD TO THE BILL NO.130 OF M/S PA DWAL TRANSPORT CLAIMED TO HAVE BEEN ISSUED BY HIM THE TRANSPORTER STATED THAT IT WAS FABRICATED BY THE OTHER PARTY I.E. ASSESSEE. THE SAID TRANSPORTER AL SO POINTED OUT THAT THE TRANSPORTATION CHARGES FROM CHAKAN, PUNE TO SILVASS A UNIT WOULD HAVE BEEN HIGHER THAN THE AMOUNT REPORTED BY THE ASSESSEE AND THAT IN ANY CASE THE VEHICLE NUMBER PROVIDED BY THE ASSESSEE COULD NOT H AVE BEEN USED FOR TRANSPORTATION FROM CHAKAN, PUNE TO SILVASSA AS IT DID NOT HAVE A NATIONAL PERMIT. 14. WHEN ASSESSEE WAS CONFRONTED WITH THE AFORESAID EVIDENCE, IT FILED A DETAILED SUBMISSION DATED 21.12.2010 BEFORE THE ASS ESSING OFFICER ON 27.12.2010. A COPY OF THE SAID REPLY IS ALSO PLACE D BEFORE US AT PAGES 75 TO 93 OF THE PAPER BOOK. APART FROM REPUDIATING THE S TAND OF THE TRANSPORTER ASSESSEE ALSO ATTEMPTED TO POINT OUT THE FALSITY IN THE STATEMENT DEPOSED BY THE TRANSPORTER. THE FOLLOWING PORTION OF THE ASSE SSEES COMMUNICATION IS RELEVANT :- NOW COMING TO THE MERITS OF THE STATEMENT OF SHRI PADWAL, IN SUBSTANCE SHRI PADWAL HAS STATED THAT HE HAD NEVER TRANSPORTED ANY GOODS FROM KAVITA INDUSTRIES PVT. LTD, PUNE, TO VEENA INDUSTRIES LTD, SILVASSA AND ALSO FROM VEENA INDUSTRIES LTD, SILVASSA TO SNA INDUSTRIES, C HAKAN, PUNE. THE AFORESAID STATEMENT OF SHRI PADWAL IS ABSOLUTELY FA LSE. IT MAY BE STATED HERE THAT EITHER SHRI PADWAL HAS MADE THE AFORESAID FALS E STATEMENT FOR THE REASONS BEST KNOWN TO HIM OR HE HAS MADE THE AFORES AID STATEMENT UNDER DURESS AND COERCION FROM THE OFFICIALS OF THE IT DE PARTMENT. THE FOLLOWING FACTS WILL CLEARLY ESTABLISH THE FALS ITY OF THE ABOVE STATEMENT OF SHRI PADWAL : 1. WE HAVE GOT A LORRY RECEIPT (LR) OR A GOODS CONS IGNMENT NOTE NO.130, DATED 28.03.2004, ISSUED BY PADWAL TRANSPORT, GAWAL IMATHA, TELCO ROAD, BHOSARI, PUNE-411 026. AS PER THE AFORESAID LR, PAD WAL TRANSPORT THROUGH ITS VEHICLE NO.MH14 F3444, HAD TRANSPORTED ONE ENGINE, ONE ALTERNATOR AND ONE BASE FRAME FROM KAVITA INDUSTRIE S PVT. LTD, PUNE, TO VEENA INDUSTRIES LTD, SILVASSA. ON THE AFORESAID LR , THERE IS A STAMP OF VEENA INDUSTRIES LTD AND ON THE AFORESAID LR, IT IS ALSO STATED THAT THE ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 AFORESAID ITEMS WERE RECEIVED BY VEENA INDUSTRIES L TD. ON 29.03.2004. BESIDES, ON THE AFORESAID LR NO.130, INVOICE NO.004 , RAISED BY KAVITA INDUSTRIES PVT. LTD, ON VEENA INDUSTRIES LTD, DATED 28.03.2004, HAS ALSO BEEN MENTIONED. 2. WE HAVE GOT LR NO.131, DATED 28.03.2004, ISSUED BY PADWAL TRANSPORT. AS PER THE AFORESAID LR, PADWAL TRANSPORT THROUGH I TS VEHICLE NO.MH14 F3444, HAD TRANSPORTED A CONSIGNMENT FROM SNA INDUS TRIES, CHAKAN, PUNE, TO AUTOMECH INDIA PVT. LTD, SILVASSA, ON 28.0 3.2004. ON THE AFORESAID LR, THERE IS A STAMP OF AUTOMECH INDIA PV T. LTD., ACKNOWLEDGING THE RECEIPT OF THEIR CONSIGNMENT ON 29.03.2004. BES IDES, ON THE AFORESAID LR NO.131, BILL NO.27 RAISED BY SNA INDUSTRIES ON A UTOMECH INDIA PVT. LTD., DATED 28.03.2004, HAS ALSO BEEN MENTIONED. IT MAY BE EMPHATICALLY STATED HERE THAT THERE IS AB SOLUTELY NO DISPUTE, AS REGARDS THE GENUINENESS OF THE AFORESAID LR NO.13 1. 3. WE HAVE GOT BILL NO.246, DATED 28.03.2004, ISSUE D BY PADWAL TRANSPORT. THE AFORESAID BILL HAS RAISED TRANSPORT CHARGES OF RS.1820 ON KAVITA INDUSTRIES PVT.LTD. ON THE SAME BILL NO.246, SHRI P ADWAL HAS SIGNED ON 30.03.2004 AND STATED THEREIN 'CASH RECEIVED'. IT M AY BE FURTHER STATED THAT THE AFORESAID BILL, DATED 28.03.2004, HAS ALSO BEEN SIGNED BY SHRI M.S.PADWAL. IN ADDITION, ON THE AFORESAID BILL, THE LR NO. 130 HAS ALSO BEEN MENTIONED. 4. WE HAVE GOT BILL NO.247, DATED 28.03.2004, ISSUE D BY PADWAL TRANSPORT. THE AFORESAID BILL HAS RAISED TRANSPORT CHARGES OF RS.1,820, ON SNA INDUSTRIES, CHAKAN, PUNE. ON THE SAME BILL NO.247, SHRI PADWAL HAS SIGNED ON 30.03.2004 AND STATED THEREIN 'CASH RECEI VED'. IT MAY BE FURTHER STATED THAT THE AFORESAID BILL, DATED 28.03.2004, H AS ALSO BEEN SIGNED BY SHRI M.S.PADWAL. IN ADDITION, ON THE AFORESAID BILL , THE LR NO. 131 HAS ALSO BEEN MENTIONED. IT MAY BE EMPHATICALLY STATED HERE THAT THERE IS AB SOLUTELY NO DISPUTE, AS REGARDS THE GENUINENESS OF THE AFORESAID BILL NO.24 7. 5. WE HAVE GOT IN OUR POSSESSION LR NO.132, DATED 3 0.03.2004, WHICH HAS BEEN SIGNED BY SHRI PADWAL, HIMSELF. AS PER THE AF ORESAID LR NO.132, DATED 30.03.2004, ENGINE, ALTERNATOR SET ON BASE FR AME (GENSET), HAS BEEN TRANSPORTED FROM VEENA INDUSTRIES LTD, SILVASS A, TO SNA INDUSTRIES, CHAKAN, PUNE. FOR THE AFORESAID PURPOSE, VEHICLE NO .MH14 F3444, BELONGING TO PADWAL TRANSPORT HAS BEEN USED. IN THE AFORESAID LR, INVOICE NO.001, RAISED BY VEENA INDUSTRIES LTD, SIL VASSA, ON SNA INDUSTRIES, PUNE, HAS ALSO BEEN STATED. FURTHER, ON THE BACK SIDE OF THE AFORESAID INVOICE, THE DATE OF THE TRANSPORT OF THE AFORESAID ITEMS AND VEHICLE NO.MH14 F3444 HAS BEEN STATED AS PER THE IN WARD MATERIAL STAMP SIGNED BY THE SECURITY OF SNA INDUSTRIES, CHAKAN, P UNE. 6. WE HAVE GOT IN OUR POSSESSION LR NO.133, DATED 3 0.03.2004, WHICH HAS BEEN SIGNED BY SHRI PADWAL, HIMSELF. AS PER THE AF ORESAID LR NO.133, DATED 30.03.2004, ONE CONSIGNMENT HAS BEEN TRANSPOR TED FROM AUTOMECH INDIA PVT. LTD., SILVASSA TO KAVITA INDUSTRIES PVT. LTD., PUNE. FOR THE AFORESAID PURPOSE, VEHICLE NO.MH14 F3444, BELONGING TO PADWAL TRANSPORT HAS BEEN USED. IN THE AFORESAID LR, INVOI CE NO.001, RAISED BY AUTOMECH INDIA PVT. LTD, SILVASS ON KAVITA INDUSTRI ES PVT. LTD, PUNE, HAS ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 ALSO BEEN STATED. FURTHER ON THE LR NO.133, THERE I S A STAMP OF KAVITA INDUSTRIES PVT. LTD, ACKNOWLEDGING THE RECEIPT OF T HE AFORESAID CONSIGNMENT. IT MAY BE EMPHATICALLY STATED HERE THAT THERE IS AB SOLUTELY NO DISPUTE, AS REGARDS THE GENUINENESS OF THE AFORESAID LR NC.133. 7. WE HAVE GOT BILL NO.249, DATED 30.03.2004 ISSUE D BY PADWAL TRANSPORT AND SIGNED BY SHRI PADWAL HIMSELF. THE AFORESAID B ILL HAS RAISED TRANSPORT CHARGES OF RS.1820 ON SNA INDUSTRIES, CHAKAN, PUNE. ON THE SAME BILL NO.249, SHRI PADWAL HAS SIGNED ON 31.03.2004 AND ST ATED THEREIN 'CASH RECEIVED'. IN ADDITION, ON THE AFORESAID BILL, THE LR NO.132 HAS ALSO BEEN MENTIONED. 8. WE HAVE GOT BILL NO.248, DATED 30.03.2004, ISSUE D BY PADWAL TRANSPORT AND SIGNED BY SHRI PADWAL, HIMSELF. THE AFORESAID B ILL HAS RAISED TRANSPORT CHARGES OF RS.1,820 ON KAVITA INDUSTRIES PVT. LTD, PUNE. ON THE SAME BILL NO.248, SHRI PADWAL HAS SIGNED ON 30.03.2004 AND ST ATED THEREIN 'CASH RECEIVED'. IN ADDITION, ON THE AFORESAID BILL, LR N O.133, HAS ALSO BEEN MENTIONED. IT MAY BE EMPHATICALLY STATED HERE THAT THERE IS AB SOLUTELY NO DISPUTE, AS REGARDS THE GENUINENESS OF THE AFORESAID BILL NO.2 48. 9. FROM THE AFORESAID FACTUAL POSITION, IT IS CLEAR LY ESTABLISHED THAT THE AFORESAID VEHICLE NO.MH14 F3444, BELONGING TO PADWA L TRANSPORT HAD CARRIED TWO CONSIGNMENTS FROM PUNE TO SILVASSA ON 2 8.03.2004, ONE BELONGING TO KAVITA INDUSTRIES PVT. LTD AND THE OTH ER BELONGING TO SNA INDUSTRIES. FURTHER, THE SAME VEHICLE HAD BROUGHT B ACK TWO CONSIGNMENTS FROM SILVASSA TO PUNE ON 30.03.2004, ONE BELONGING TO AUTOMECH INDUSTRIES PVT. LTD AND THE OTHER BELONGING TO VEEN A INDUSTRIES LTD., SILVASSA. IT MAY BE FURTHER STATED IN THIS REGARD THAT THERE IS ABSOLUTELY NO DISPUTE, AS REGARDS THE GENUINENESS OF THE AFORESAID LR NOS. 131 AND 133 AND BILL NOS.247 AND 248. THEREFORE, AS A COROLLARY, THERE C ANNOT BE ANY DISPUTE, AS REGARDS THE GENUINENESS OF THE IMPUGNED LR NOS.1 30 AND 132 AND BILL NOS.246 AND 249. IN ADDITION, IT MAY ALSO BE STATED THAT THROUGH THE TRANSPORT OF THE AFORESAID TWO CONSIGNMENTS FROM PUNE TO SILVASSA AND TWO CONS IGNMENTS FROM SILVASSA TO PUNE, BY THE SAME VEHICLE, PADWAL TRANS PORT HAD RECEIVED TRANSPORT CHARGES TO THE EXTENT OF RS.7,280. THEREF ORE, THE STATEMENT OF SHRI M.S.PADWAL AT THE END OF HIS LETTER, DATED 10. 12.2010, THAT IT WAS QUITE IMPOSSIBLE TO MAKE A TRIP FROM PUNE TO SILVAS SA FOR A SUM OF RS.1,820, BECAUSE THE DISTANCE BETWEEN PUNE TO SILV ASSA AND BACK IS 750 KMS; IS NOT CORRECT. SHRI PADWAL HAS FURTHER ST ATED THAT THE TRANSPORT CHARGES FOR THE AFORESAID TRIP SHOULD HAVE BEEN RS. 5,000. THIS STATEMENT OF SHRI PADWAL IS ALSO PROVED TO BE FALSE, BECAUSE SHRI PADWAL HAS EARNED AS MUCH AS RS.7,280, THROUGH THE AFORESAID TRIP FRO M PUNE TO SILVASSA AND BACK. 10. IT MAY BE FURTHER STATED THAT ON BOTH THE AFORE SAID LR NO.130, DATED 28.03.2004 AND LR NO.132, DATED 30.03.2004, ALL THE DETAILS PRINTED ARE ABSOLUTELY CORRECT, VIS-A-VIS THE PRESENT DETAILS O F PADVVAL TRANSPORT. FURTHER, BOTH THE AFORESAID LORRY RECEIPTS, SR.NOS. ARE PRINTED AND THE ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 SAME ARE NOT WRITTEN IN HAND. OBVIOUSLY, THE ASSES SEE-COMPANY COULD NOT HAVE GOT THE AFORESAID LRS PRINTED ON ITS OWN. FURTHER, ON THE AFORESAID LRS, THE LORRY NO.MH14 F3444 HAS ALSO BEE N MENTIONED AND THE AFORESAID LORRY IS STILL OWNED AND BEING USED B Y SHRI PADWAI, THIS IS QUITE CLEAR FROM THE REPLY OF SHRI PADWAI TO QUESTI ON NO.4 OF THE STATEMENT OF SHRI PADWAL, RECORDED BY THE AO ON 10.12.2010. 11. SIMILARLY, ON THE OTHER LR NO.131, DATED 28.03. 2004 AND LR NO.133, DATED 30.03.2004, ALL THE DETAILS PRINTED ARE THE S AME, AS THE PRESENT DETAILS OF PADWAL TRANSPORT AND THERE IS ABSOLUTELY NO DISPUTE IN RESPECT OF THE GENUINENESS OF THE AFORESAID LRS AND THE DETAIL S PRINTED THEREON. IN VIEW OF THE AFORESAID REASONS, WHEN THE AFORESAI D UNDISPUTED LR NOS.131 AND 133 ARE GENUINE, AS A COROLLARY, THE IM PUGNED LR NOS.130 AND 132 ARE ALSO GENUINE. 12. FURTHER, THE AFORESAID BILL NOS.246 AND 249 ALS O VERY CLEARLY BELONG TO PADWAL TRANSPORT. IN BOTH THE AFORESAID BILLS, THE CORRECT ADDRESS OF PADWAL TRANSPORT HAS BEEN PRINTED. FURTHER, THE BIL L NUMBERS HAVE ALSO BEEN PRINTED AND NOT WRITTEN IN HAND ON BOTH THE AF ORESAID BILLS. IN ADDITION, ON BOTH THE AFORESAID BILLS, MOBILE NO.98 22423314 HAS BEEN PRINTED AND THIS MOBILE NUMBER IS STILL IN THE NAME OF SHRI M.S.PADWAL AND THE SAME IS BEING USED BY HIM. OBVIOUSLY, THE ASSES SEE-COMPANY COULD NOT HAVE GOT THE AFORESAID BILLS PRINTED ON ITS OWN . 13. SIMILARLY, ON THE OTHER BILL NOS.247 AND 248, B ELONGING TO PADWAL TRANSPORT, ALL THE DETAILS PRINTED THEREON ARE THE SAME AS THE PRESENT DETAILS OF PADWAL TRANSPORT AND THERE IS ABSOLUTELY NO DISPUTE, IN RESPECT OF THE GENUINENESS OF THE AFORESAID BILLS AND THE D ETAILS PRINTED THEREON. IN VIEW OF THE AFORESAID REASONS, WHEN THE AFORESAI D UNDISPUTED BILL NOS.247 AND 248 ARE GENUINE, AS A COROLLARY, THE IM PUGNED BILL NOS.246 AND 249, WILL ALSO BE GENUINE. 14. THE MOST IMPORTANT AND SIGNIFICANT FACT IS THAT ON THE AFORESAID TWO LRS, THERE ARE FOUR SIGNATURES OF SHRI M.S.PADWAL, ONE O N EACH. FURTHER, ON THE AFORESAID BILLS, THERE ARE EIGHT SIGNATURES OF SHRI PADWAL, BEING TWO ON EACH OF THE AFORESAID BILLS. THUS, WE HAVE GOT TWELVE (12) SIGNATURES OF SHRI M.S.PADWAL IN OUR POSSESSION, WHICH RELATE T O THE CONTEMPORANEOUS PERIOD. ALL THE AFORESAID SIGNATURES ARE EXACTLY THE SAME A ND ALL OF THEM FULLY TALLY WITH THE FOUR SIGNATURES OF SHRI M.S.PADWAL ON HIS LETTER, DATED 10.12.2010, ADDRESSED TO THE AO. FURTHER, SHIR PADW AL HAS MADE SEVEN SIGNATURES ON HIS STATEMENT RECORDED BY THE AO ON 1 0.12.2010 AND ALL THE AFORESAID SIGNATURES ARE ALSO FULLY TALLYING WITH H IS SIGNATURES ON THE AFORESAID LRS AND BILLS. IN THE FACT OF THE AFORESAID FACTS, HOW CAN SHRI PA DWAL DENY THE GENUINENESS OF THE IMPUGNED TWO LRS AND TWO BILLS. 15. AS PER PARA 10 OF THE LETTER OF SHRI PADWAL TO THE AO, DATED 10.12.2010, SHRI PADWAL HAS STATED THAT THE BILL BOOKS FOR THE PERIOD FROM 01.03.2004 TO 31.03.2004, WERE NOT AVAILABLE WITH HIM. ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 IN THIS REGARD, IT IS TO BE STATED THAT IF THE BILL BOOKS OR THE LR BOOKS ARE NOT AVAILABLE WITH HIM, THEN ON WHAT BASIS HAS HE MADE A STATEMENT THAT THE IMPUGNED LRS AND BILLS DO NOT BELONG TO HIM. IT IS VERY DIFFICULT TO BELIEVE THAT SHRI PADWAL HAS GOT SUCH A SELECTIVE M EMORY. COPIES OF THE AFORESAID LRS AND INVOICES ARE ENCLOS ED HEREWITH, VIDE PAPER- BOOK - B, FOR THE AYS 2005-06 AND 2008-09. FROM THE AFORESAID FACTS, IT IS CLEARLY ESTABLISHED THAT THE IMPUGNED LR NOS.130 AND 132, AS WELL AS THE BILL NOS.246 AND 24 9 ARE ABSOLUTELY GENUINE AND THE STATEMENT OF SHRI PADWAL THAT HE HAD NEVER TRANSPORTER ANY GOODS FOR KAVITA INDUSTRIES PVT. LTD. TO VEENA INDUSTRIES LTD , SILVASSA AND ALSO FOR VEENA INDUSTRIES LTD., SILVASSA TO SNA INDUSTRIES, CHAKAN, PUNE, IS TOTALLY FALSE. IN THIS CONNECTION, WE WOULD ALSO LIKE TO VERY EMPH ATICALLY STATE THAT WE WILL PROVE TO THE HILT THAT AFORESAID STATEMENT OF SHRI PADWAL IS NOT ONLY UNSUBSTANTIATED BUT ALSO FALSE AND FOR THIS PURPOSE , IF NECESSARY, WE WILL OBTAIN A REPORT OF A HAND WRITING EXPERT AND BESIDE S, WE WOULD ALSO CROSS- EXAMINE SHRI PADWAL, IN THE LIGHT OF THE AFORESAID FACTS. 15. IT TRANSPIRES THAT THE ASSESSING OFFICER AGAIN CONFRONTED THE TRANSPORTER, SHRI M.S. PADWAL WHOSE STATEMENT WAS AGAIN RECORDED ON 28.12.2010, COPY OF WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGES 102 TO 104. THE RELEVANT PORTION OF THE SAID STATEMENT READS AS UNE R :- QUESTION NO. 1:- PLEASE INTRODUCE YOURSELF. ANSWER:- I AM MANIK SOPAN PADWAL, PROPRIETOR OF PAD WAL TRANSPORT. QUESTION NO. 2:- VEENA INDUSTRIES LTD. VIDE ITS LE TTER DATED 21-12-2010 RECEIVED IN THIS OFFICE ON 27-12-2010 HAS ENCLOSED L.R. NUMBER (LORRIE RECEIPT NUMBER) 131 AND 133 DATED 28-03-2004 AND 30 -03-2004 ISSUED AND SIGNED BY YOU FOR THE CONSIGNER SNA INDUSTRIES, CHA KAN, AND AUTO MECH INDIA PVT. LTD., SILVASSA RESPECTIVELY. IT HAS ALSO FURNI SHED BILL NO.247 AND BILL NO.248 ISSUED BY YOU FOR CASH RECEIVED AGAINST THE TRANSPORTATION OF GOODS. I AM SHOWING YOU THE ABOVE L.RS. AND 'BILLS. PLEASE G O THROUGH THEM AND STATE AS TO WHETHER THESE L.RS. HAVE BEEN ISSUED BY YOU O R NOT AND ALSO CONFIRM WHETHER THEY HAVE BEEN SIGNED BY YOU OR NOT. ALSO C ONFIRM WHETHER THE GOODS HAVE BEEN TRANSPORTED BY YOU FROM CHAKAN, PUNE TO S ILVASSA AND SILVASSA TO CHAKAN, PUNE OR NOT FOR THESE PARTIES. ANSWER:- YES, THE ABOVE REFERRED L.RS. AND BILLS N UMBER HAVE BEEN ISSUED TO AND SIGNED BY ME FOR THE PARTIES WHOSE NA MES ARE APPEARING ON THE L.RS. AND THE BILLS. I ALSO CONFIRM THAT THE PAYMEN TS HAVE BEEN RECEIVED BY ME. BUT IN THIS CONNECTION I WANT TO STATE THAT I H AD TRANSPORTED THE GOODS FOR THOSE PARTIES FOR LOCAL TRIPS ONLY AND NOT FOR OUTS IDE OF MAHARASHTRA STATE. I HAVE MENTIONED THE ADDRESS OF SILVASSA FOR AUTO MEC H INDIA PVT. LTD, BECAUSE THE SAID PARTY HAD TOLD ME TO MENTION SUCH ADDRESS ON THE BILLS. I COULD NOT UNDERSTAND THAT MENTIONING OF ADDRESS WOULD MEAN TH AT THE GOODS HAVE BEEN TRANSPORTED TO SILVASSA OR FROM SILVASSA. IN THIS C ONNECTION, I FURTHER WART TO STATE THAT I HAVE NEVER TRANSPORTED THE GOODS FOR T HOSE PARTIES FROM CHAKAN, ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 PUNE TO SILVASSA AND FROM SILVASSS TO CHAKAN, PUNE AND FOR ANY OTHER OUTSIDE PLACES OTHER THAN LOCAL. I FURTHER WANT TO STATE TH AT I HAVE NOT DONE ANY TRANSPORTATION WORK FOR THOSE PARTIES IN SUBSEQUENT YEARS. QUESTION NO.3:- VEENA INDUSTRIES LTD. HAS ENCLOSED BILL NUMBER 246 AND BILL NO.249 FOR L.R. NUMBERS 130 AND 132, IN SU PPORT OF CASH PAYMENT RECEIVED BY YOU AS PER THESE BILL ISSUED BY YOU ON 28-03-2004 AND 30-03- 2004 RESPECTIVELY. HERE IT IS IMPORTANT TO GIVE REF ERENCE TO THE STATEMENT GIVEN BY YOU ON OATH ON 10-12-2010 WHEREIN YOU HAVE STATE D THAT L.R.S NUMBERS 130 & 132 WERE NOT ISSUED BY YOU TO THE CONCERNED P ARTIES AND THESE TWO L.RS. ARE FABRICATED BY THOSE PARTIES FOR THEIR PER SONAL BENEFITS. I AM SHOWING YOU BILL NO.246 & 249 AND ALSO L.R. NUMBERS 130 &13 2. PLEASE GO THROUGH THESE L.RS. AND BILLS AND STATE WHETHER YOU HAVE RE CEIVED CASH PAYMENTS AS PER THOSE BILLS ISSUED BY YOU TO THE CONCERNED PART IES FOR TRANSPORTATION OF GOODS FROM CHAKAN, PUNE TO SILVASSA AND FROM SILVAS SA TO CHAKAN, PUNE, KEEPING IN VIEW THE STATEMENT GIVEN BY YOU ON 10-12 -2010 ON THIS ISSUE. ANSWER:- IN THIS CONNECTION I WANT TO MAKE REFERENC E TO MY STATEMENT GIVEN ON 10-12-2010 WHEREIN I DENIED TO HAVE ISSUED L.RS. NUMBER 130 & 132 ON THE GROUND THAT I HAD NOT TRANSPORTED ANY GO ODS FOR THOSE PARITIES WHOSE NAMES APPEARING ON THOSE TWO L.RS., FROM CHAK AN, PUNE TO SILVASSA AND SILVASSA TO CHAKAN, PUNE AND ALSO ON THE GROUND THAT INVOICES NUMBER 01 AND 04 (REFERENCE OF WHICH ARE IN MY STATEMENT G IVEN ON 10-12-2010) DO NOT MENTION VEHICLE NUMBER WHICH HAS BEEN MENTIONED ON THOSE TWO L.RS. I.E. MH 14 F 3444 WHICH IS OWNED BY ME. I FURTHER WANT T O STATE THAT THE SAID VEHICLE IS NOT HAVING NATIONAL PERMIT PASSING BY TH E R.T.O. AND UNDER THIS CIRCUMSTANCE; THE SAID VEHICLE CANNOT BE USED FOR TRANSPORTATION OF GOODS, OUTSIDE OF MAHARASHTRA, UNLESS I TAKE TEMPORARY PER MIT AT THE BORDER/ OF ANY TWO STATES. SINCE, EVEN THE TEMPORARY PERMIT IS NOT TAKEN BY ME FOR TRANSPORTATION OF GOODS OUTSIDE OF MAHARASHTRA I CO ULD NOT FURNISH PROOF IN RESPECT OF R.T.O. TAX PAID IF ANY BY ME, AS REQUIRE D-BY YOU VIDE YOUR LETTER DATED 10-12-2010 MENTIONED AT PARA 3.1 THEREIN BECA USE I DID NOT TRANSPORT ANY GOODS FOR THESE PARTIES OUTSIDE THE MAHARASHTRA STATES. THEREFORE, THOSE TWO L.RS. WERE ISSUED BY ME FOR LOCAL TRIPS ONLY. I WANT TO STATE THAT YOU HAVE MISUNDERSTOOD MY STATEMENT GIVEN ON 10-12-2010. WHA T I MEANT TO STATE ON 10-12-2010 IS THAT THESE TWO L.RS. WERE NOT ISSUED BY ME FOR TRANSPORTATION OF GOODS FROM CHAKAN, PUNE TO SILVASSA AND SILVASSA TO CHAKAN, PUNE. THESE PARTIES HAD TOLD ME TO MENTION THAT ADDRESS OF SILV ASSA UNIT AND THEREFORE I DID THE SAME WITHOUT UNDERSTANDING THE IMPLICATION/ GRAVITY THAT MENTIONING OF ADDRESS OF SILVASSA UNIT WOULD MEAN TRANSPORTATION OF GOODS TO SILVASSA OR FROM SILVASSA. THEREFORE, THESE TWO L.RS. AND BILLS WERE ISSUED BY ME FOR LOCAL TRIPS ONLY. I STILL MAINTAIN THAT THE STATEME NT GIVEN BY ME ON 10-12-2010 ON THIS ISSUE IS CORRECT IN THE SENSE THAT THESE TW O L.RS. WERE NOT ISSUED FOR TRANSPORTATION OF GOODS FROM CHAKAN, PUNE TO SILVAS SA AND FROM SILVASSA TO CHAKAN, PUNE BUT ISSUED FOR LOCAL TRIPS ONLY AND AC CORDINGLY, I ISSUED BILLS FOR CASH RECEIVED AGAINST TRANSPORTATION OF GOODS F ROM CHAKAN, PUNE TO BHOSARI, PUNE AND BHOSARI, PUNE TO CHAKAN, PUNE ONL Y. QUESTION NO.4:- PLEASE STATE WHETHER YOU HAVE DONE ANY TRANSPORTATION WORK FOR VEENA INDUSTRIES LTD., KAVITA INDUSTRIES L TD. AND SNA INDUSTRIES IN SUBSEQUENT YEAR ALSO? ANSWER:- NO, I HAVE NOT DONE ANY TRANSPORTATION WOR K FOR THESE PARTIES IN SUBSEQUENT YEARS FOR LOCAL TRIPS. ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 16. IN NUTSHELL, THE ASSESSING OFFICER RELIED UPON THE STATEMENT OF THE TRANSPORTER TO INFER THAT THERE WAS NEITHER TRANSPO RTATION OF RAW MATERIAL TO SILVASSA UNIT AND NOR THE MANUFACTURED GENERATOR SE T WAS TRANSPORTED FROM SILVASSA UNIT TO M/S SNA INDUSTRIES, CHAKAN PUNE. THE ASSESSING OFFICER WAS ALSO NOT SATISFIED WITH THE REPLIES OF THE ASSE SSEE WITH REGARD TO THE ELECTRICITY CONSUMPTION DURING THE PERIOD. THE ASS ESSING OFFICER WAS ALSO NOT SATISFIED THAT ASSESSEE HAD PURCHASED THE RAW MATER IAL FROM M/S KAVITA INDUSTRIES PVT. LTD. AND UTILIZED THE SAME FOR ASSE MBLING A GENERATOR SET WHICH WAS CLAIMED TO HAVE BEEN SOLD TO M/S SNA INDUSTRIES BEFORE 31.03.2004. NEVERTHELESS, THE PURCHASE OF RAW MATERIAL I.E. ENG INES FROM MAHINDRA & MAHINDRA LTD. WAS NOT DOUBTED IN TERMS OF WHICH ASS ESSEE HAD EXPLAINED THAT THE SAID RAW MATERIAL HAD REACHED ITS FACTORY ON 29 .03.2004. ACCORDING TO THE ASSESSING OFFICER, THOUGH ASSESSEE HAD PURCHASED RA W MATERIALS FROM MAHINDRA & MAHINDRA LTD. IN THE SHAPE OF ENGINES BU T IT HAD FAILED TO PROVE THE COMMENCEMENT OF MANUFACTURING ACTIVITY ON OR BEFORE 31.03.2004. FOR ALL THE AFORESAID REASONS, THE ASSESSING OFFICER DENIED THE ASSESSEES CLAIM FOR DEDUCTION U/S 80-IB(4) OF THE ACT. 17. ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE TH E CIT(A). THE CIT(A) HAS ALSO AFFIRMED THE ORDER OF THE ASSESSING OFFICE R. IT IS NOTICED THAT THE CIT(A) HAS BASED HIS DECISION ON THE BASIS OF THE M ATERIAL ON RECORD AND IN THE ABSENCE OF ANY SUBMISSIONS OF THE ASSESSEE ON MERIT S. ASSESSEE HAD SOUGHT ADJOURNMENT FROM THE CIT(A) ON THE GROUND THAT FOR ASSESSMENT YEARS 2006- 07 AND 2007-08, THE DEPARTMENTAL APPEALS ON THE SAM E ISSUE WERE PENDING BEFORE THE TRIBUNAL. THE CIT(A) DID NOT ACCEDE TO ASSESSEES REQUEST FOR ADJOURNMENT BEYOND A PERIOD AND THEREFORE HE PROCEE DED TO DECIDE THE APPEAL ON THE BASIS OF THE AVAILABLE FACTS ON RECOR D AND EX-PARTE QUA THE ASSESSEE. BE THAT AS IT MAY, IN THIS BACKGROUND, W E HAVE HEARD THE RIVAL COUNSELS. ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 18. BEFORE US, THE LD. REPRESENTATIVE FOR THE ASSES SEE VEHEMENTLY POINTED OUT THAT BEFORE THE ASSESSING OFFICER, ASSESSEE HAD PRODUCED VARIOUS EVIDENCES IN SUPPORT, NAMELY, (I) LEASE DEED DATED 09.03.2004 SUBSTANTIATING THE OCCUPATION OF THE FACTORY PREMISES AT SILVASSA; (II) REGISTRATION OF THE SILVASSA UNIT WITH THE EXCISE AUTHORITY DATED 24.03 .2004, A COPY OF WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGE 120; (III) A CERTIFICATE OF REGISTRATION ISSUED BY THE SALES-TAX AUTHORITIES OF THE UNION TE RRITORY OF DADRA AND NAGAR HAVELI RELATING TO THE SILVASSA UNIT W.E.F. 24.03.2 004, A COPY OF WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGES 121 TO 122; (IV) THE INVOICE RAISED BY THE M/S KAVITA INDUSTRIES PVT. LTD. DATED 28.03.2004 EV IDENCING PURCHASE OF RAW MATERIALS, A COPY OF WHICH HAS BEEN PLACED IN THE P APER BOOK AT PAGE 104; (V) EVIDENCE OF PURCHASE OF COMPONENTS, I.E. ENGINES MA HINDRA & MAHINDRA LTD. VIDE INVOICE DATED 29.03.2004 WHICH WAS ALSO RECEIV ED AT THE SILVASSA UNIT PRIOR TO 31.03.2004, COPY OF WHICH HAS BEEN PLACED AT PAGES 125 TO 129 OF THE PAPER BOOK; (VI) A COPY OF THE EXCISE REGISTER RG-2 3 SHOWING ENTRIES FOR THE DUTY CREDIT PERTAINING TO TRANSACTIONS PRIOR TO 31. 03.2004, COPY OF WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGES 130 TO 132; AND, (VII) A COPY OF THE EXCISE RETURN FILED ON 05.04.2004 BY THE ASSESSEE F OR THE PERIOD ENDING 31.03.2004 WAS ALSO FURNISHED, A COPY OF WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGES 133 TO 138. FURTHER, ASSESSEE ALSO F URNISHED THE EVIDENCE OF TRANSPORTATION OF GOODS OF RAW MATERIAL TO SILVASSA AND THE REMITTANCE OF FINISHED GOODS TO M/S SNA INDUSTRIES. THE LD. REPR ESENTATIVE POINTED OUT THAT THE STATEMENT OF THE TRANSPORTER OF M/S PADWAL TRAN SPORT WAS UNRELIABLE AS WELL AS THAT THE TWO STATEMENTS WERE INHERENT BY CO NTRADICTORY. MOREOVER, IT IS SUBMITTED THAT THE RECORDS OF THE ASSESSEE, NAMELY, EXCISE RECORDS, ETC. SUBSTANTIATE THE PLEA OF THE ASSESSEE THAT THE MANU FACTURING ACTIVITY HAD TAKEN BEFORE 31.03.2004. ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 19. ON THE OTHER HAND, THE LD. CIT-DR APPEARING FOR THE REVENUE HAS IN DETAIL REFERRED TO THE ORDER OF THE ASSESSING OFFIC ER IN SUPPORT OF THE CASE OF THE REVENUE. 20. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS. AFTER HAVING CONSIDERED THE ORDERS OF THE AUTHORITIES BELOW AND THE RIVAL SUBMISSIONS, ONE ISSUE WHICH COMES OUT IS THAT MAJOR PLANK OF THE RE VENUE IS BASED ON THE ENQUIRIES CONDUCTED WITH THE TRANSPORTER. IN-FACT, WHETHER OR NOT THE MANUFACTURING ACTIVITY OF THE ASSESSEE AT SILVASSA UNIT HAD COMMENCED ON OR BEFORE 31.03.2004 IS A MATTER OF FACTUAL APPRECIATI ON. THE LETTER OF THE TRANSPORTER DATED 10.12.2010, AND HIS STATEMENT OF EVEN DATE WHICH HAVE BEEN HEAVILY RELIED UPON BY THE ASSESSING OFFICER, HAVE BEEN PLACED AT PAGES 152 TO 155 AND 156 TO 161 OF THE PAPER BOOK. IT IS NOTICEABLE THAT ON 10.12.2010 WHEN THE TRANSPORTER WAS PUT TO QUESTION , HE DENIED OF ANY BUSINESS TRANSACTION OR RELATION WITH THE ASSESSEE OF M/S KAVITA INDUSTRIES PVT. LTD.. FURTHER, WHEN THE BILLS PURPORTED TO HAVE BE EN ISSUED BY HIM TO M/S KAVITA INDUSTRIES PVT. LTD. AND ASSESSEE WERE PUT T O HIM, IT WAS STATED THAT THOSE BILLS I.E. BILL NOS.130 AND 132 RESPECTIVELY WERE NOT ISSUED BY HIM. THOUGH, HE CONFIRMED THE VEHICLE NUMBER MENTIONED I N THE BILLS BUT IT WAS CLAIMED BY HIM THAT THE SAID VEHICLE WAS NOT SENT B Y HIM FROM CHAKAN, PUNE (I.E. THE PREMISES OF M/S KAVITA INDUSTRIES PVT. LT D.) TO SILVASSA UNIT OF THE ASSESSEE. AFTER NOTICING THE DENIAL OF THE TRANSPO RTER, HE WAS ALSO ASKED TO PRODUCE A LOG BOOK, IF ANY, MAINTAINED BY HIM SHOWI NG MOVEMENT OF THE VEHICLE IN QUESTION. IN RESPONSE, IT WAS STATED TH AT THOUGH THE VEHICLE WAS OWNED BY HIM BUT NO LOG BOOK WAS MAINTAINED FOR ITS MOVEMENT. ON BEING ASKED TO PRODUCE THE BILL BOOK FOR THE RELEVANT PER IOD, THE SAID TRANSPORTER REPLIED THAT IT WAS NOT AVAILABLE AND IT WAS KEPT I N THE GODOWN IN HIS RESIDENTIAL HOUSE WHICH HE HAD SINCE SHIFTED OUT. THE TRANSPOR TER ALSO CONFIRMED THAT THE BILL NOS. 130 AND 132 PURPORTED TO HAVE BEEN ISSUED BY HIM WERE NOT EVEN ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 SIGNED BY HIM AND NOR WERE ISSUED BY HIM. WHEN ALL THESE WERE PUT TO THE ASSESSEE, A DETAILED WRITTEN COMMUNICATION WAS FURN ISHED, WHICH WE HAVE ALREADY REPRODUCED IN THE EARLIER PART OF THIS ORDE R. THE CLAIM OF THE ASSESSEE WAS THAT THE RELEVANT TRANSPORT BILLS WERE ISSUED B Y THE TRANSPORTER HIMSELF AND WERE DULY SIGNED BY HIM. THE REPLY FURNISHED BY TH E ASSESSEE CLARIFIED THE POSITION THAT THE VEHICLE IN QUESTION BELONGED TO T HE M/S PADWAL TRANSPORT, WHO CARRIED TWO CONSIGNMENTS FROM PUNE TO SILVASSA ON 28.03.2004 ONE BELONGING TO M/S KAVITA INDUSTRIES PVT. LTD. AND TH E OTHER BELONGING TO M/S SNA INDUSTRIES. FURTHER, THE SAME VEHICLE BROUGHT BACK TWO CONSIGNMENTS FROM SILVASSA TO PUNE ON 30.03.2004 ONE BELONGING T O M/S AUTO MECH INDUSTRIES PVT. LTD. AND OTHER BELONGING TO ASSESSE ES SILVASSA UNIT. IT WAS POINTED OUT THAT NOT ONLY TWO BILL NOS. 130 AND 132 WERE ISSUED BY THE TRANSPORTER BUT ALSO BILL NOS. 246 AND 249 WHICH RE LATED TO M/S PADWAL TRANSPORT FOR CARRYING OF TWO CONSIGNMENTS FROM PUN E TO SILVASSA ON 28.03.2004 AND BRINGING BACK THE CONSIGNMENT TO PUN E ON 30.03.2004. IT WAS POINTED OUT THAT TOTAL TRANSPORTATION CHARGES COVER ING THE FOUR BILLS TOTALLED TO RS.7,280/- AND THEREFORE THE CASE SETUP BY THE TRAN SPORTER IN HIS STATEMENT THAT IT WAS IMPOSSIBLE TO MAKE HIM TRIP FROM PUNE T O SILVASSA FOR A SUM OF RS.1,820/- WAS ONLY HALF-TRUTH BECAUSE THE TRANSPOR TER HAD EARNED MUCH MORE THAN THE FIGURE OF RS.1,820/- WHICH RELATED TO ONLY ONE OF THE FOUR BILLS RAISED. IT WAS ALSO POINTED OUT THAT THE TRANSPORTER HAD HI MSELF STATED THAT THE TRANSPORTATION CHARGES FOR ONE TRIP BETWEEN PUNE AN D SILVASSA SHOULD HAVE BEEN RS.5,000/-, A STATEMENT MADE IN THE CONTEXT OF THE AMOUNT OF RS.1,820/- STATED IN THE BILL SHOWN TO HIM. THE ASSESSEE POIN TED OUT THAT THE TRANSPORTER HAD EARNED RS.7,280/- WHICH SHOWED THAT THE CHARGES WERE COMMENSURATE TO WHAT WAS THE EXPECTATION OF THE TRANSPORTER. SINCE ASSESSEE POINTED OUT THAT BILL NOS. 246 AND 249 DATED 30.03.2004 WHICH WERE I SSUED BY THE M/S PADWAL TRANSPORT ON M/S KAVITA INDUSTRIES PVT. LTD. AND M/ S SNA INDUSTRIES, CHAKAN, RESPECTIVELY WERE GENUINE, THERE WAS NO REASON FOR THE TRANSPORTER TO HAVE ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 DENIED THE AUTHENTICITY OF THE OTHER TWO BILLS, NAM ELY, 130 AND 132. IT WAS POINTED OUT THAT ON THE BASIS OF OTHER BILLS OF THE TRANSPORTER ALSO THAT THE SIGNATURES ON ALL THE BILLS ARE IDENTICAL AND SIMIL AR. WE FIND THAT WHEN THE TRANSPORTER WAS AGAIN PUT TO EXAMINATION BY THE ASS ESSING OFFICER, HE RESCINDED FROM HIS EARLIER STAND OF THE BILLS HAVIN G BEEN FABRICATED. A COPY OF THE SAID STATEMENT RECORDED ON 28.12.2010 IS PLACED AT PAGES 20 TO 24 OF THE PAPER BOOK. THE RELEVANT PORTION OF THE SAME IS AL READY REPRODUCED IN THE EARLIER PART OF THIS ORDER. NEVERTHELESS, WHEN THE ASSESSING OFFICER PUT ACROSS TO THE TRANSPORTER BILL NOS. 246 AND 249 ISSUED BY HIM AS ALSO THE CONTENTS OF ASSESSEES SUBMISSIONS IT WAS ADMITTED THAT THE LR AND BILLS WERE INDEED ISSUED AND SIGNED BY HIM. THE TRANSPORTER EXPLAINE D THAT THE BILLS RELATED TO THE LOCAL TRANSPORTATION AND NOT FOR TRANSPORTATION OUTSIDE MAHARASHTRA AND THAT IN THE BILLS HE HAD MENTIONED THE ADDRESS OF S ILVASSA MERELY FOR THE PURPOSES OF BILLING. ACCORDING TO THE TRANSPORTER, THOUGH THE LRS AND BILLS WERE ISSUED BY HIM BUT THEY WERE FOR LOCAL TRANSPOR TATION ONLY AND THERE WAS NO TRANSPORTATION OF GOODS FROM CHAKAN, PUNE TO SIL VASSA OR FROM SILVASSA TO CHAKAN, PUNE. 21. OSTENSIBLY, THERE ARE APPARENT CONTRADICTIONS I N THE STATEMENTS FURNISHED BY THE TRANSPORTER AT THE DIFFERENT POINT S OF TIME. IN SUCH A SITUATION, ONE OF THE COURSE AVAILABLE WAS FOR A CROSS-EXAMINA TION OF THE TRANSPORTER BY THE ASSESSEE. ON THIS ASPECT, WE FIND THAT THE AS SESSING OFFICER DID ALLOW AN OPPORTUNITY TO THE ASSESSEE OF CROSS-EXAMINING THE TRANSPORTER. WE FIND THAT IN THIS CONTEXT, THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO CROSS-EXAMINE THE TRANSPORTER ON 29.12.2010. THE SAID OPPORTUNIT Y WAS ALLOWED BY THE ASSESSING OFFICER THROUGH A COMMUNICATION DATED 28. 12.2010, A COPY OF WHICH HAS BEEN PLACED ON RECORD. THE ASSESSEE DID NOT AV AIL OF THIS OPPORTUNITY FOR THE REASON EXPLAINED IN ITS EXPLANATION DATED 28.12 .2010 TO THE ASSESSING OFFICER, A COPY OF WHICH HAS BEEN PLACED AT PAGES 9 5-96 OF THE PAPER BOOK. ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 THE ASSESSEE POINTED OUT THAT EARLIER IT HAD CONTEN DED THAT DUE TO THE CONTRADICTORY POSITION TAKEN BY THE TRANSPORTER A R EPORT OF THE HANDWRITING EXPERT BE CALLED FOR TO ESTABLISH AS TO WHETHER THE SIGNATURE ON THE TRANSPORT BILLS WERE THAT OF SHRI PADWAL OR NOT. IT WAS ALSO ASSERTED BY THE ASSESSEE THAT THE CROSS-EXAMINATION WOULD NOT SERVE ANY PURPOSE W HEN THE APPROPRIATE PREPARATION WAS NOT POSSIBLE AT A SHORT NOTICE. NO DOUBT, TECHNICALLY SPEAKING, AN OPPORTUNITY WAS ALLOWED TO THE ASSESSEE TO CROSS -EXAMINE THE TRANSPORTER. THE ASSESSMENT ORDER HAS BEEN PASSED ON 31.12.2010 AND OBVIOUSLY THE CROSS-EXAMINATION OPPORTUNITY WAS ALLOWED AT THE FA GEND OF THE PROCEEDINGS. OF-COURSE, ONE OF THE REASONS FOR THE CROSS-EXAMINA TION TO BE ALLOWED AT THE FAGEND WAS THAT THE INVESTIGATION ITSELF WERE START ED LATE BY THE ASSESSING OFFICER. BUT THE MOOT QUESTION IS THAT CAN IT BE C ONCLUSIVELY ESTABLISHED ON THE BASIS OF THE APPARENTLY INCONSISTENT STAND OF THE T RANSPORTER THAT THERE WAS NO TRANSACTION EFFECTED WITH M/S KAVITA INDUSTRIES PVT . LTD. OR M/S SNA INDUSTRIES PRIOR TO 31.03.2004. IN-FACT, IN THE EXCISE RETURN FURNISHED BY THE ASSESSEE, A COPY OF WHICH HAS BEEN PLACED AT PAGES 131 TO 132 O F THE PAPER BOOK, IT IS REVEALED THAT ASSESSEE RETURNED THE QUANTITY MANUFA CTURED AND ALSO SHOWED ITS LIABILITY FOR EXCISE DUTY ON THE QUANTITY MANUF ACTURED AND SOLD. THE SAID RETURN OF INCOME IS DATED 05.04.2004 AND AT THE TIM E OF HEARING, THE ORIGINAL COPIES OF THE SAID WERE ALSO CALLED FOR AND PERUSED . THE SAID RETURN CORRESPONDED TO THE QUARTER ENDING ON 31.03.2004. THE REFLECTION OF QUANTITY OF GOODS MANUFACTURED AND LIABILITY OF EXCISE DUTY THEREOF IN THE SAID RETURN HAS NOT BEEN DISAPPROVED BY THE REVENUE AT ANY STAG E. THERE IS ALSO NO REASON FOR US TO DISREGARD THE SAME. NEVERTHELESS, IT IS ALSO EMERGING THAT SO FAR AS THE EVIDENCE OF TRANSPORTATION IS CONCERNED IT DOES NOT CLINCHINGLY ESTABLISH THE CASE EITHER WAY. UNDER THESE CIRCUMS TANCES, IN OUR VIEW, IT WAS NOT ONLY IMPERATIVE BUT ALSO PRUDENT THAT THE CROSS -EXAMINATION OF THE TRANSPORTER WAS UNDERTAKEN SO AS TO ENABLE THE ASSE SSING OFFICER TO COME TO APPROPRIATE FINDINGS. IN OUR CONSIDERED OPINION, I T WOULD MEET THE ENDS OF ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 JUSTICE IF THE MATTER IS RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER WHO SHALL CERTAINLY CONFRONTED THE ASSESSEE WITH THE MA TERIAL WITH HIM BUT ALSO ENSURE THAT AN APPROPRIATE AND ADEQUATE OPPORTUNITY OF CROSS-EXAMINATION IS ALLOWED TO THE ASSESSEE. IT IS ALSO RELEVANT TO SA Y THAT IN RESPONSE TO THE DENIALS BY THE TRANSPORTER, INITIALLY THE ASSESSEE HAD MADE A DETAILED SUBMISSION ATTEMPTING TO DEMOLISH THE VERSION OF TH E TRANSPORTER. THE INITIAL BURDEN ON THE ASSESSEE STOOD DISCHARGED IN VIEW OF ITS SUBMISSIONS DATED 21.12.2010 AND THEREFORE IT WAS IN FITNESS OF THING S THAT CROSS-EXAMINATION WAS CARRIED OUT SO AS TO ENABLE THE ASSESSING OFFICER T O COME TO AN APPROPRIATE AND CREDIBLE FINDINGS THEREOF. THUS, WE SET-ASIDE THE ORDER OF THE CIT(A) AND RESTORE THE MATTER BACK TO THE FILE OF THE ASSESSIN G OFFICER WHO SHALL MAKE AN ORDER AFRESH AFTER ALLOWING THE NECESSARY OPPORTUNI TY TO THE ASSESSEE OF BEING HEARD AND KEEPING IN MIND OUT ABOVE DIRECTIONS. TH US, FOR ASSESSMENT YEAR 2005-06, ASSESSEE PARTLY SUCCEEDS FOR STATISTICAL P URPOSES. 22. SINCE IT WAS A COMMON POINT BETWEEN THE PARTIES THAT THE ISSUE IN THE OTHER THREE APPEALS ARE IDENTICAL, OUR DECISION IN ASSESSEES APPEAL FOR ASSESSMENT YEAR 2005-06 (SUPRA) IN THE ABOVE PARAS WOULD APPLY MUTATIS- MUTANDIS IN THE OTHER THREE APPEALS ALSO. 23. AS A CONSEQUENCE, THE APPEALS OF THE ASSESSEE A S WELL AS OF THE REVENUE ARE PARTLY ALLOWED, AS ABOVE. ORDER PRONOUNCED ON 27 TH FEBRUARY, 2015. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 27 TH FEBRUARY, 2015. SUJEET ITA NOS.283 & 1344/PN/2010 ITA NOS.1368 & 1369/PN/2012 COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-V, PUNE; 4) THE CIT-V, PUNE; 5) THE DR B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// ASSISTANT REGISTRAR I.T.A.T., PUNE