The ITO, Cochin V. M/s.Deev Genset P. Ltd, Aluva

ITA 202/COCH/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 7478 (ITAT-COCHIN)
• Duration Of Justice: 11 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2016
• Appeal Filed By: Department
• Bench Allotted: DB
• Next Hearing Date: 02-03-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 31-03-2015
• Court: TRIBUNAL
• Department Lawyers: K P GOPAKUMAR

Judgement Text

ITA NO. 202/COCH/2015 1 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI B P JAIN, AM & GEORGE GEORGE.K, JM ITA NO.202/COCH/2015 (ASST YEAR: 2006-07 ) INCOME TAX OFFICER,, CORP. WARD-1(2), KOCHI. M/S. DEEV GENSET (P) LTD., INDUSTRIAL DEVELOPMENT AREA, KEENPURAM, SOUTH VAZHAKULAM, ALUVA-683 105. ( REVENUE -APPELLANT) VS (ASSESSEE -RESPONDENT) PAN NO. AABCD 5141P REVENUE BY SHRI K.P. GOPAKUMAR, SR. DR ASSESSEE BY SHRI MATHEW JOSEPH, CA DATE OF HEARING 02/03/2016 DATE OF PRONOUNCEMENT 03/03/2016 ORDER PER B P JAIN, AM: THIS APPEAL OF THE REVENUE ARISES FROM THE ORDER O F THE LD. CIT(A)-I, KOCHI DATED 09/01/2015 FOR THE ASSESSMENT YEAR 2006-07. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF THE COMMISSIONER OF INCOME TAX (AP PEALS) I, KOCHI, IN APPEAL NO. I.T.A. 11/R-1/E/CIT(A)-I/2013-14 DATED 0 9/01/2015, IS OPPOSED TO LAW, WEIGHT OF EVIDENCE, FACTS AND CIRCUMSTANCES OF THE CASE. 2. WHETHER ON FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) WAS RIGHT IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER BASED ON THE SUBMISSION OF THE ASSESSEE THAT THE ASSESSEE HAS BE EN ACCOUNTING THE PURCHASE AND SALES BOTH AS NET OF EXCISE DUTY AND E XCISE DUTY ON PURCHASE IS DEBITED TO EXCISE DUTY ACCOUNT AND EXCISE DUTY O N SALES IS CREDITED TO EXCISE DUTY ACCOUNT? ITA NO. 202/COCH/2015 2 3. FOR THESE AND OTHER GROUNDS THAT MAY BE URGED A T THE TIME OF HEARING, IT IS REQUESTED THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS) MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER RESTORED. 3. THE BRIEF FACTS OF THE CASE AS EMANATING FROM T HE ORDER OF THE ASSESSING OFFICER ARE REPRODUCED HEREINBEOW: IT HAS BEEN HELD BY THE ASSESSING OFFICER THAT ON VERIFICATION, IT IS OBSERVED THAT AS PER NOTES ON ACCOUNTS, THE ASSESSEE WAS ENT ITLED TO EXCISE DUTY DRAWBACK OF RS.38,31,053/- ON PURCHASE OF RAW MATER IAL UNDER CENVAT. THIS AMOUNT HAD NOT BEEN DEDUCTED FROM THE AMOUNT OF PUR CHASES OF RAW MATERIAL DEBITED TO THE PROFIT AND LOSS ACCOUNT. AT THE SAME TIME, IN RESPECT OF SALES, THE ASSESSEE HAD CREDITED ONLY THE NET AM OUNT OF SALES OBTAINED BY DEDUCTING THE EXCISE DUTY PAYABLE ON SALES FROM THE AMOUNT OF GROSS SALES. THUS, THOUGH THE ASSESSEE CLAIMED DEDUCTION FOR EXP ENSES ON ACCOUNT OF EXCISE DUTY PAYABLE, INCOME BY WAY OF EXCISE DUTY D RAWBACK DURING THE YEAR AMOUNTING TO RS.38,31,053/- WAS NOT OFFERED FO R ASSESSMENT. HENCE, THE CENVAT CREDIT OF RS.38,31,053/- IS TREATED AS ASSES SEES INCOME AND ADDED TO THE TOTAL INCOME. 4. THE LD. CIT(A) DELETED THE ADDITION VIDE PARAS 5 AND 6 OF HIS ORDER WHICH FOR THE SAKE OF CONVENIENCE IS REPRODUCED HEREINBELOW: 5. THE APPELLANT HAS PRODUCED THE INVOICE FOR PURC HASE ACCOUNT ALONG WITH LEDGER FOR THE EXCISE DUTY ACCOUNT AS WELL AS PURCH ASE ACCOUNT FROM GREAVES COTTON LIMITED AND THE SALE INVOICE OF THE ASSESSEE COMPANY, IT HAS EXPLAINED THAT THE TOTAL EXCISE DUTY PAID FOR THE YEAR ON FINISHED GOODS 38,85,680 EXCISE DUTY PAID ON RAW MATERIALS 38,31,053 OPENING CENVAT BALANCE 9,90,537 CENVAT CREDIT DURING THE YEAR 38,31,053 TOTAL 48,21,5 90 LESS : DUTY PAID 38,85,680 ITA NO. 202/COCH/2015 3 CENVAT CREDIT AVAILABLE 9,30,910 THE CENVAT CREDIT AVAILABLE IS VERIFIABLE FROM THE LA ST MONTHLY RETURN OF EXCISE AS ON 3-03- 2005 PRODUCED. IT IS SEEN FROM THE SUBMISSION OF THE APPELLANT THAT THE ASSESSEE HAS BEEN ACCOUNTING THE PURCHASE AND SALES BOTH AS NET OF EXCI SE DUTY,AND EXCISE DUTY ON PURCHASE IS DEBITED TO EXCISE DUTY ACCOUNT AND THE EXCI SE DUTY ON SALES IS CREDITED TO EXCISE DUTY ACCOUNT. 6. IN VIEW OF THIS, IT IS HELD THAT THE ASSESSING OFF ICER HAS NOT BASIS FOR TREATING THE AVAILABLE CENVAT CREDIT FOR THE YEAR, AS THE INCOME O F THE ASSESSEE. HENCE, THE ADDITION MADE BY THE ASSESSING OFFICER IS DELETED AND APPEAL ON THIS GROUND IS ALLOWED. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. IT IS UNDISPUTED THAT THE ASSESSEE HAS BEEN ACCOUNTING PURCHASE A ND SALES BOTH AS NET OF EXCISE DUTY. EXCISE DUTY ON PURCHASE IS DEBITED TO EX CISE DUTY ACCOUNT AND ALSO THE EXCISE DUTY ON SALES IS CREDITED TO EXCISE DUTY ACCO UNT. THE ASSESSEE HAS PRODUCED INVOICE FOR PURCHASE ACCOUNT ALONG WITH LEDGER FOR THE EXCISE DUTY ACCOUNT AS WELL AS PURCHASE ACCOUNT FROM GREAVES COTTON LIMITED AND THE SAL E INVOICE OF THE ASSESSEE COMPANY WHERE THE CENVAT CREDIT AVAILABLE WAS RS.9,30, 910/-. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ASSESSING OFFICER HAS NO BASIS FOR TREATING THE AVAILABLE CENVAT CREDIT FOR THE YEAR, AS THE INCOME O F THE ASSESSEE AND ACCORDINGLY, THE ADDITION MADE BY THE ASSESSING OFFICER HAS RIGHTLY BEE N DELETED BY THE LD. CIT(A) AND WE FIND NO INFIRMITY IN HIS ORDER. THUS ALL THE GROUND S OF THE REVENUE ARE DISMISSED. ITA NO. 202/COCH/2015 4 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMI SSED. ORDER PRONOUNCED IN THE OPEN COURT ON 0 3-03-2016 SD/- SD/- ( GEORGE GEORGE.K) (B P JAIN ) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE : COCHIN DATED: 3RD MARCH, 2016 GJ COPY TO: 1. M/S. DEEV GENSET (P) LTD., INDUSTRIAL DEVELOPMEN T AREA, KEENPURAM, SOUTH VAZHAKULAM, ALUVA-683 105. 2. THE INCOME TAX OFFICER, WARD-1(2), KOCHI. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS)-I, KOCHI 4. THE COMMISSIONER OF INCOME-TAX, KOCHI 5. DR/ITAT, COCHIN 6. GUARD FILE. BY ORDER ASSISTANT REGISTRAR ITAT, COCHIN 1.DATE OF DICTATION : 03/03/2016 2.DATE ON WHICH THE TYPED DRAFT IS PLACED 03/03/2016 BEFORE THE DICTATING MEMBER OTHER MEMBER: 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . PS/PS: 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER : 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. PS/PS : 6. DATE ON WHICH THE FILE GOES TO BENCH CLERK: 7. DATE ON WHICH THE FILE GOES TO HEAD CLERK: 8. DATE ON WHICH THE FILE GOES TO ASSISTANT REGISTR AR 9. DATE OF DISPATCH OF THE ORDER: ITA NO. 202/COCH/2015 5