The ACIT,Vapi Circle, Vapi V. M/s. Mani More Synthetics Pvt.Ltd., SILVASSA

ITA 1436/AHD/2011

• Counselvise Citation: 143620514 RSA 2011
• Duration Of Justice: 3 year(s) 3 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-09-2014
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 20-08-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 19-05-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MK SINGH

Judgement Text

, , , , C, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, C BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ # ## #. .. .# ## #. . . . % % % %, , , , &' ( & ' &' ( & ' &' ( & ' &' ( & ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND N.S. SAINI, ACCOUNTANT MEMBER) ITA NO.1436/AHD/2011 [ASSTT.YEAR : 2006-2007] ACIT, VAPI CIRCLE VAPI. /VS. MANI MORE SYNTHETICS P. LTD. 1195, GOVT. HOUSING SOCIETY SILVASA. PAN : AABCM 9782 C ( (( (*+ *+ *+ *+ / APPELLANT) ( (( (,-*+ ,-*+ ,-*+ ,-*+ / RESPONDENT) ( . / &/ REVENUE BY : SHRI M.K. SINGH 12 . / &/ ASSESSEE BY : NONE 3 . 24'/ DATE OF HEARING : 20 TH AUGUST, 2014 567 . 24'/ DATE OF PRONOUNCEMENT : 05/09/2014 &8 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THIS APPEAL BY THE REVENUE FOR THE ASSESSMENT YEAR 2006-2007 IS DIRECTED AGAIN ST THE ORDER OF THE CIT(A). 2. NONE APPEARED ON BEHALF OF THE ASSESSEE AT THE T IME OF HEARING OF THE APPEAL BEFORE THE TRIBUNAL. NOTICE SENT BY REGISTE RED AD POST HAS BEEN RETURNED BY THE POSTAL AUTHORITIES WITH THE REMARK LEFT. IN THESE FACTS OF THE CASE, WE PROCEED TO DISPOSE OF THE APPEAL OF THE REVENUE EX PARTE QUA THE ASSESSEE- RESPONDENT ON MERITS AFTER HEARING THE LEARNED DR. ITA NO.1436/AHD/2011 -2- 3. THE GROUND NO.1 OF THE REVENUE IS AS UNDER: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 46,61,828/- MADE IN VIE OF INCLUSIVE PROVISIONS OF SECTION 1245A OF THE ACT IN RESPECT OF UNUTILIZED AMOUNT LYING UNDER MODVAT CREDIT 4. THE LEARNED DR HAS REFERRED TO THE RELEVANT PORT IONS OF THE ASSESSMENT ORDER IN SUPPORT OF THE CASE OF THE REVENUE. HE, I N PARTICULAR, REFERRED TO PARA 5 OF THE ASSESSMENT ORDER, WHEREIN THE IMPUGNED ADDIT ION WAS MADE BY THE AO. WE HAVE CONSIDERED SUBMISSIONS OF THE LEARNED DR AN D PERUSED THE ORDERS OF THE AO AND THE CIT(A). WE FIND THAT THE CIT(A) HAS RECORDED A FINDING THAT THE ASSESSEE HAS NOT DEBITED ITS PROFIT & LOSS ACCOUNT WITH GROSS EXCISE DUTY LIABILITY. THE CIT(A) HAS PASSED A DETAILED SPEAKI NG ORDER ON THIS ISSUE AND HAS RECORDED ALL THE RELEVANT FIGURES AND THE FACTS OF THE ISSUE BEFORE HIM. THE CIT(A) HAS RECORDED THAT THE UNUTILIZED MODVAT WAS RS.46,61,828/-, I.E. THE ASSESSEE HAS PAID THAT MUCH DUTY WHICH WAS TO BE AD JUSTED IN THE LATER STAGE WHEN THE GOODS ARE PRODUCED, AND ACCORDINGLY, THE U NUTILIZED MODVAT CANNOT TAKE THE NATURE OF INCOME. HE HAS ALSO FOLLOWED TH E DECISION OF THE HONBLE APEX COURT IN THE CASE OF CIT VS. INDO NIPPON CHEMI CALS CO. LTD., 261 ITR 275 (SC) AND HAS DELETED THE ADDITION. THERE BEING NO MISTAKE IN THE ORDER OF THE CIT(A) ON THIS ISSUE, AS THE UNUTILISED MODVAT COULD NOT TAKE THE NATURE OF INCOME, AND THE ISSUE BEING COVERED IN FAVOUR OF THE ASSESSEE IN THE FACTS OF THE CASE, WITH THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. INDO NIPPON CHEMICALS CO. LTD. (SUPRA), WE HOLD THA T THERE IS NO MERIT IN THE GROUND NO.1 OF THE REVENUE, WHICH IS ACCORDINGLY DI SMISSED. 5. THE GROUND NO.2 OF THE APPEAL OF THE REVENUE IS AS UNDER: 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.9,0 0,000/- TOWARDS UNACCOUNTED OIL GAIN. ITA NO.1436/AHD/2011 -3- 6. THE LEARNED DR RELIED ON THE ORDER OF THE AO. H E REFERRED TO RELEVANT PORTIONS OF THE ASSESSMENT ORDER IN SUPPORT OF THE CASE OF THE REVENUE. THE LEARNED DR SUBMITTED THAT THE CIT(A) SHOULD HAVE AL LOWED A CHANCE TO THE AO TO VERIFY THE FACTS BEFORE DELETING THE ADDITION MA DE BY THE AO. 7. WE HAVE CONSIDERED SUBMISSION OF THE LEARNED DR AND PERUSED THE ORDERS OF THE AO AND THE CIT(A). WE FIND THAT THE CIT(A) HAS DELETED THE ADDITION BY HOLDING THAT INFERENCE DRAWN BY THE AO WERE BASED O N ERRONEOUS ARITHMETICAL WORKING, AND THEREFORE, NOT VALID. HOWEVER, WE FIN D THAT IN ALL FAIRNESS, THE CIT(A) SHOULD HAVE CALLED FOR A REMAND REPORT ON TH E ISSUE IN ORDER TO VERIFY THE FACTS AND FIGURES AS SUBMITTED BY THE ASSESSEE. NO SUCH EXERCISE WAS UNDERTAKEN IN THIS CASE. IN THESE FACTS OF THE CAS E, WE ARE OF THE VIEW THAT IT SHALL BE IN THE INTEREST OF JUSTICE TO RESTORE THIS ISSUE IN THE GROUND NO.2 OF THE REVENUES APPEAL REGARDING ADDITION ON ACCOUNT OF U NACCOUNTED OIL GAIN TO THE FILE OF THE AO WITH DIRECTION TO DECIDE THE SAME DE NOVO IN ACCORDANCE WITH LAW AFTER ALLOWING REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ASSESSEE SHALL BE AT LIBERTY TO FILE ANY EVIDENCE IN SUPPORT OF ITS CASE BEFORE THE AO. THE AO IS FURTHER DIRECTED TO VERIFY THE FIGURES OF HIG HER OIL GAIN OF 101.87% SHOWN BY THE ASSESSEE, AND AFTER VERIFICATION TO DECIDE T HE ISSUE AS PER THE LAW. WE DIRECT ACCORDINGLY. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS PART LY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( # ## #. .. .# ## #. . . . % % % % /N.S.SAINI) &' ( &' ( &' ( &' ( /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT