Income-tax Officer, V. M/s. Mauli Steel Pvt. Ltd., Jalna

ITA 2020/PUN/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0407 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 13-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Additional evidence
• Section: 69C; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO. 20 2 0 /PN/20 1 4 / ASSESSMENT YEAR: 20 0 5 - 0 6 THE INCOME TAX OFFICER, WARD - 1(3), JALNA . / APPELLANT VS. M/S. MAULI STEEL PVT. LTD., C - 15, ADDL. MIDC AREA, JALNA . / RESPONDENT PAN : AAB CM6718R / APPELLANT BY : SHRI RAJEEV KUMAR, CIT / RESPONDENT BY : S HRI S.N. PURANIK / DATE OF HEARING : 2 4 . 1 1 .201 6 / DATE OF PRONOUNCEMENT: 30 . 1 1 .201 6 / ORDE R / ORDE R PER SUSHMA CHOWLA, JM: TH IS APPEAL FILED BY THE REVENUE IS AGAINST ORDER OF CIT( A ), AURANGABAD , DATED 2 5 . 0 8 .201 4 RELATING TO ASSESSMENT YEAR 20 0 5 - 0 6 AGAINST ORDER PASSED UNDER SECTION 143(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2. THE RE VENUE HAS RAISED THE FOLLOWING GROUND OF APPEAL: - ITA NO . 20 2 0 / PN / 201 4 M/S. MAULI STEEL PVT. LTD. 2 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE CIT(A) WAS JUSTIFIED IN QUANTIFYING THE SUPPRESSED PRODUCTION @ 4% EVEN AFTER ACCEPTING THE FACT THAT THE ASSESSEE INDULGED IN CLANDESTINE R EMOVAL OF GOODS WITHOUT PAYMENT OF TAXES. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE WHETHER THE CIT(A) WAS JUSTIFIED IN NOT APPRECIATING THE FACT THAT MANUFACTURING AND ADMINISTRATIVE EXPENSES ON THE UNACCOUNTED PRODUCTION WORKED OUT IN THE APP ELLATE ORDER HAD ALREADY BEEN BORNE BY THE PRODUCTION SHOWN IN THE BOOKS OF ACCOUNT ? 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE WHETHER THE CIT(A) WAS JUSTIFIED IN NOT APPRECIATING THE FACT THAT THE WORKING CAPITAL IS REQUIRED FOR PURCHASE OF R AW MATERIAL AND DAY TO DAY ACTIVITIES FOR PRODUCTION OF GOODS EVERY YEAR. 4. THE ORDER OF THE AO BE RESTORED AND THAT OF THE CIT(A) BE VACATED. 3 . THE ASSESSEE HAS MOVED AN APPLICATION UNDER RULE 27 OF THE INCOME TAX TRIBUNAL RULES, 1963 , WHEREIN THE RES PONDENT - ASSESSEE CLAIMED THAT THOUGH IT HAD NOT FILED ANY APPEAL OR CROSS OBJECTIONS AGAINST THE APPEAL FILED BY THE REVENUE BUT IT IS AGGRIEVED BY THE ORDER OF CIT(A) IN RESTRICTING THE GROSS PROFIT @ 4% ON TOTAL SALES. 4 . THE LEARNED AUTHORIZED REPRES ENTATIVE FOR THE ASSESSEE POINTED OUT THAT IN VIEW OF THE PROVISIONS OF RULE 27 OF THE INCOME TAX TRIBUNAL RULES, 1963, THE RESPONDENT - ASSESSEE CAN AGITATE ANY GROUND DECIDED AGAINST HIM. HE FURTHER STATED THAT THE ISSUE RAISED IN THE PRESENT APPEAL IS SQ UARELY COVERED BY THE ORDER OF TRIBUNAL IN ASSESSEES OWN CASE AND THE CIT(A) HAD RESTRICTED THE ADDITION APPLYING GP @ 4% ON TOTAL SALES, AGAINST WHICH THE REVENUE IS IN APPEAL . THE NEXT CONTENTION OF THE ASSESSEE IN THIS REGARD WAS THAT THE TRIBUNAL IN EARLIER YEARS HAD DECIDED THE ISSUE BY RESTRICTING THE ADDITION BY APPLYING GP @ 4% ON THE GOODS WHICH WERE CLANDESTINELY REMOVED AND NOT ON THE ENTIRE SALES OF THE YEAR UNDER APPEAL. 5 . THE APPLICATION MOVED BY THE ASSESSEE UNDER RULE 27 OF THE INCOME TA X TRIBUNAL RULES, 1963 MERITS TO BE ADMITTED AND WE PROCEED TO DECIDE THE PRESENT ITA NO . 20 2 0 / PN / 201 4 M/S. MAULI STEEL PVT. LTD. 3 APPEAL FILED BY THE REVENUE AND THE ISSUE RAISED BY THE ASSESSEE UNDER RULE 27 OF THE INCOME TAX TRIBUNAL RULES, 1963 HEREINAFTER. 6. THE ISSUE RAISED IN THE GROUNDS OF APPE AL FILED BY THE REVENUE IS AGAINST DELETION OF ADDITION MADE ON ACCOUNT OF SALE OF ALLEGED SUPPRESSED PRODUCTION. 7. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF MANUFACTURE OF MS INGOTS / BILLETS. FOR THE YEAR UNDER C ONSIDERATION, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD CONSUMED 2, 53 , 25 ,1 00 ELECTRICITY UNITS AND HAD PRODUCED GOODS TO THE EXTENT OF 17,779 MT. THE ASSESSING OFFICER ESTIMATED THE PRODUCTION OF GOODS @ 1026 ELECTRICITY UNITS PER TON AT 24 , 683 MT AND ARRIVED AT SUPPRESSED PRODUCTION OF 5867 MT. THE ASSESSING OFFICER COMPUTED THE ADDITIONAL INCOME IN THE HANDS OF ASSESSEE ON ACCOUNT OF SUPPRESSED PRODUCTION AND MADE ADDITION AT RS. 5,02,90,300 / - . SUPPRESSED PRODUCTION AND MADE ADDITION AT RS. 5,02,90,300 / - . 8 . BEFORE THE CIT(A), THE LEARNED AUTHORIZED REPRES ENTATIVE FOR THE ASSESSEE POINTED OUT THAT NO ADDITION WAS WARRANTED ON ACCOUNT OF FOLLOWING VARIOUS REASONS: - (1) THE BOOKS OF ACCOUNTS OF THE APPELLANT ARE AUDITED UNDER COMPANIES ACT AS WELL AS INCOME TAX ACT. IN SOME OF THE YEARS UNDER APPEAL, IN SO ME OF THE CASES OF MS INGOTS/BILLETS MANUFACTURERS THE SCRUTINY U/S 143(3) FOR EARLIER YEARS WAS COMPLETED WITHOUT ANY ADDITION TOWARDS SUPPRESSED SALE. (2) CENTRAL EXCISE DEPARTMENT VIDE ITS ORDER HAS SIMPLY & INCORRECTLY ESTIMATED THAT FOR MANUFACTURI NG ONE METRIC TON MS INGOT, 1026 UNITS OF ELECTRICITY ARE REQUIRED. (3) THE ORDER OF COMMISSIONER OF CENTRAL EXCISE IS BASED ON ESTIMATES, ACADEMIC STUDY AND THEORETICAL CALCULATIONS AND HENCE IS CHALLENGED BY THE ASSESSEE BEFORE CESTAT. (4) THE CENTR AL EXCISE DEPARTMENT HAS ACTUALLY VERIFIED ELECTRICITY CONSUMPTION IN APPELLANT'S PLANT WHICH WAS FOUND TO BE IN ORDER. THE EXCISE DEPARTMENT SHOULD HAVE WORKED OUT THE ELECTRICITY UNITS REQUIRED FOR PRODUCING ONE METRIC TON MS INGOTS/BILLETS BY ACTUAL PHYSICAL VERIFICATION IN THE PLANTS OF VARIOUS MANUFACTURERS. (5) THE RELIANCE PLACED BY THE COMMISSIONER OF CENTRAL EXCISE IN ITS ORDER ON THE REPORT OF I.I.T., KANPUR AND TECHNICAL REPORT OF DR.BATRA IS MISPLACED AS THE ITA NO . 20 2 0 / PN / 201 4 M/S. MAULI STEEL PVT. LTD. 4 COPIES OF THE SAID REPORTS WER E NEITHER GIVEN TO THE APPELLANT NOR ANY CROSS EXAMINATION WAS ALLOWED. (6) THE EXECUTIVE DIRECTOR, ALL INDIA FURNACE ASSOCIATION VIDE HIS REPORT DATED 18/03/2008 HAS STATED THAT THE HIGHER CONSUMPTION OF ELECTRICITY CAN BE ATTRIBUTABLE TO LIGHT SCRAP AND SPONGE IRON ETC. REASONS. (7) THE EXCISE DEPARTMENT HAS CONSIDERED ENTIRE ELECTRICITY UNITS FOR PRODUCTION WHEREAS ABOUT 75% UNITS ARE CONSUMED FOR FURNACE I.E. FOR PRODUCTION. (8) THE RELIANCE IS PLACED ON THE DECISION IN THE CASE OF ACIT VS. SRJ PEETY STEELS PVT. LTD. (2011) 137 TT] 627 (PUNE) WHEREIN IT HAS BEEN HELD THAT NO ADDITION COULD BE MADE MERELY ON THE BASIS OF TECHNICAL ELECTRICITY CONSUMPTION FORMULA. (9) THE AO. HAS OBSERVED IN THE ASSESSMENT ORDERS THAT THE UNIT CAPACITY INCLUD ES USAGE OF FURNACE LOAD OR AUXILIARY LOAD; A 6 MT FURNACE WILL CONSUME SLIGHTLY MORE POWER THAN 25 MT FURNACE PER METRIC TON OF PRODUCTION; A CONTINUOUS CASTING PROCESS USES MORE ELECTRICITY, HOWEVER, THE AO HAS NOT GIVEN EFFECT TO THE ABOVE OBSERVATIO NS IN THE ASSESSMENT ORDER. (10) THE UNDISCLOSED PRODUCTION CALCULATED ON THE BASIS OF ELECTRICITY CONSUMPTION IS NOT JUSTIFIED AS PER VARIOUS DECISIONS UNDER EXCISE ACT AND ALSO INCOME TAX ACT RELIED ON BY THE APPELLANTS. SOME OF THE DECISIONS HEAVILY RELIED ON ARE R.A CASTINGS VS. COMMISSIONER OF EXCISE, MEERAT - I 2009 (237) ELT 674; THIS DECISION IS UPHOLD BY THE HON'BLE ALLAHABAD HIGH COURT; NASHIK STRIPS PVT. LTD. VS. COMMISSIONER OF CENTRAL EXCISE, NASHIK 2010 - TIOL - 1110 - CESTAT (MUM); BHAVSHAKTI STEE L MINES P.L. VS. CCE, NASHIK ORDER NOS.356 - 357/11/EB/C - II, CESTAT, MUMBAI DATED 08/04/2011. (11) THE COST OF PRODUCTION CLAIMED BY THE APPELLANT IS JUSTIFIED AS SIMILAR COST (11) THE COST OF PRODUCTION CLAIMED BY THE APPELLANT IS JUSTIFIED AS SIMILAR COST OF PRODUCTION HAS BEEN SHOWN BY OTHER MORE THAN 15 COMPANIES MANUFACTURING THE SAME PRODUCTS IN JALNA INDUSTRIAL ESTATE SINCE 1985. (12) THE ADDITION ON ACCOUNT OF CLANDESTINE REMOVAL OF MS INGOTS/BILLETS IN THE EARLIER YEAR HAS BEEN AGREED ONLY TO PURCHASE PEACE OF MIND AND TO AVOID LITIGATION. 9 . THE CIT(A) HELD THAT THERE WAS NO MERIT IN ESTIMATION OF SUPPRESSED PRODUCTION OF 302 MT IN THE YEAR, IN VIEW OF THE DECISION OF THIRD MEMBER OF CESTAT ORDER DATED 17.07.2014 IN THE CASE OF OTHER STEEL MANUFACTURERS OF JALNA AND SURROUNDING AREAS. THE CIT(A) UPHELD THE ORDER OF ASSESSI NG OFFICER IN REJECTING THE BOOK RESULTS SHOWN BY THE ASSESSEE. HOWEVER, IN CASES WHERE THE ACTUAL GROSS PROFIT RATE AS PER THE BOOK WAS MORE THAN THE PROFIT, THEN ACTUAL PERCENTAGE WAS TO BE ADOPTED AND THE ASSESSING OFFICER WAS DIRECTED TO COMPUTE UNDIS CLOSED INCOME ACCORDINGLY. THE CIT(A) HELD THAT IN THE CASE UNDER APPEAL THE GROSS PROFIT ON UNDISCLOSED SALES IS TO BE REASONABL Y ESTIMATED AND THUS, HE ITA NO . 20 2 0 / PN / 201 4 M/S. MAULI STEEL PVT. LTD. 5 DIRECTED THE ASSESSING OFFICER TO APPLY GROSS PROFIT OF 4% ON THE SUPPRESSED PRODUCTION . THE CIT(A) DELETED THE ADDITION MADE ON ACCOUNT OF INITIAL UNDISCLOSED INVESTMENT FOR THE UNDISCLOSED TURNOVER. 10 . THE REVENUE IS IN APPEAL AGAINST THE ORDER OF CIT(A) ON BOTH THE ISSUES. 11 . THE ASSESSEE HAS ALSO FILED AN APPLICATION UNDER RULE 27 OF THE INCOME TAX TRIBUNAL RULES, 1963 ALLEGING THAT ONLY GP RATE OF 4% SHOULD BE APPLIED ON SUPPRESSED PRODUCTION. 12 . ON PERUSAL OF RECORD, IT IS FOUND THAT THE IDENTICAL ISSUE HAD ARISEN IN BUNCH OF APPEALS WHICH HAVE BEEN DECIDED ON VARIOUS DATES. HOWEVER, FOR AD JUDICATING THE ISSUE, REFERENCE IS MADE TO THE RATIO LAID DOWN BY THE PUNE BENCH OF TRIBUNAL IN CONSOLIDATED ORDER WITH LEAD ORDER IN SHIVSHAKTI RE - ROLLING MILLS PVT. LTD. VS. ITO IN ITA 1884/PN/2014, RELATING TO ASSESSMENT YEAR 2010 - 11, ORDER DATED 31.03. 2016, WHEREIN IDENTICAL ISSUE OF ESTIMATION OF INCOME IN THE HANDS OF ASSESSEE ON ACCOUNT OF ALLEGED SUPPRESSION OF PRODUCTION ON ACCOUNT OF VARIATION IN CONSUMPTION OF ELECTRICITY AROSE AND RELYING ON THE ORDER OF THE TRIBUNAL IN THE CASE OF RE - ROLLING MI LLS I.E. SHREE OM ROLLING MILLS PVT. LTD. VS. ADDL. CIT IN ITA NOS.125 & 127/PN/2012 AND CROSS APPEALS IN ITA NOS.430 & 431/PN/2012, RELATING TO ASSESSMENT YEARS 2007 - 08 & 2008 - 09 VIDE ORDER DATED 15.07.2015 HAD CONSIDERED THE ISSUE AT LENGTH VIDE PARAS 54 TO 87 AND VIDE PARAS 88 AND 89, THE TRIBUNAL HAD DELETED THE ADDITION ON BOTH COUNTS I.E. ADDITION MADE ON ACCOUNT OF SUPPRESSED PRODUCTION AND ALLEGED INVESTMENT IN PURCHASES, WHICH READ AS UNDER: - 88. IN THE ENTIRETY OF THE ABOVE SAID FACTS AND CIRCUM STANCES, WE HOLD THAT NO EXTRAPOLATION OF SALES FOR 300 DAYS CAN BE MADE IN THE HANDS OF THE ASSESSEE ON THE BASIS OF THE EVIDENCE FOUND FOR CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY FOR FEW DAYS, WHICH IN TURN, HAS BEEN ADMITTED BY TH E ASSESSEE BY WAY OF FILING PETITION BEFORE THE SETTLEMENT COMMISSION, WHICH IN TURN, HAS ALSO BEEN ACCEPTED BY THE SETTLEMENT COMMISSION. MERELY BECAUSE THE ITA NO . 20 2 0 / PN / 201 4 M/S. MAULI STEEL PVT. LTD. 6 SETTLEMENT COMMISSION ACCEPTED THE CLAIM OF THE ASSESSEE OF ADDITIONAL EXCISE DUTY PAYABLE ON THE SAID CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY DOES NOT ESTABLISH THE CASE OF THE REVENUE THAT THE SAID FIGURES OF ADDITIONAL PRODUCTION SHOULD BE UTILIZED FOR EXTRAPOLATING THE SALES IN THE HANDS OF THE ASSESSEE FOR THE ENTIRE YEAR. ADMITTEDLY, THE ASSESSEE HAD OFFERED ADDITIONAL INCOME ON THE SAID CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY, WHICH IS TO BE ADDED AS INCOME IN THE HANDS OF THE ASSESSEE. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FAIRLY ADMITTED THAT IN CASE THE SAID ADDITIONAL INCOME HAS NOT BEEN ADDED WHILE COMPUTING THE INCOME IN THE HANDS OF THE ASSESSEE FOR THE RESPECTIVE YEARS, THE SAME MAY BE DIRECTED TO BE ADDED IN THE HANDS OF THE RESPECTIVE ASSESSEE IN RESPECTIVE YEARS. ACCORDI NGLY, WE DIRECT THE ASSESSING OFFICER TO VERIFY FROM THE RECORDS FOR THE RESPECTIVE YEARS AND INCLUDE THE ADDITIONAL INCOME ON ACCOUNT OF SUCH ADMITTED CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY, BY THE ASSESSEE EITHER BEFORE THE SETTLE MENT COMMISSION OR BEFORE THE EXCISE AUTHORITIES, IN THE HANDS OF THE ASSESSEE. WE HAVE HEARD BUNCH OF APPEALS AND IN SOME YEARS, THERE IS NO ADMISSION OF CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY AND IN THOSE YEARS IN THE ABSENCE OF ANY EVIDENCE AND / OR ANY INVESTIGATION OR INQUIRY MADE BY THE ASSESSING OFFICER AND WHERE THE ASSESSING OFFICER HAS FAILED TO COLLECT ADDITIONAL EVIDENCE, NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE, BY WAY OF EXTRAPOLATION OF SALES FOR 300 DAYS ON ACCOUNT OF ANY EVIDENCE FOUND IN ANY PRECEDING OR SUCCEEDING YEARS. FURTHER, NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE, WHERE NO PETITION HAS BEEN FILED BY THE ASSESSEE BEFORE THE SETTLEMENT COMMISSION IN ANY OF THE RESPECTIVE YEARS OR BEFOR E THE EXCISE AUTHORITIES. 89. SINCE WE HAVE DELETED THE ADDITION IN THE HANDS OF ASSESSEE ON BOTH ACCOUNTS I.E. ADDITION MADE ON ACCOUNT OF ERRATIC CONSUMPTION OF ELECTRICITY AND ADDITION PROPOSED ON THE BASIS OF EVIDENCE FOUND FOR THE PART OF THE YEAR OF CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY, NEXT ADDITION CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY, NEXT ADDITION MADE IN THE HANDS OF THE ASSESSEE I.E. ALLEGED INVESTMENT IN THE PURCHASES FOR EFFECTING SUCH SALES WHICH GOODS HAVE BEEN CLANDESTINELY REMOVED, IS NOT SUSTAINABLE. ACCORDINGLY , WE HOLD THAT NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF ALLEGED INVESTMENT IN PURCHASES UNDER SECTION 69C OF THE ACT. 1 3 . THEREAFTER, CORRIGENDUM ORDER WAS PASSED BY THE TRIBUNAL SUBSTITUTING PARA 88 OF THE TRIBUNAL VIDE ORDER DATED 17.02.2016 AND IT WAS HELD AS UNDER: - 3. ON PERUSAL OF THE RECORD, WE FIND THAT BY AN ERROR, THE FINDINGS OF THE TRIBUNAL IN PARA 88 WITH SPECIAL REFERENCE TO FROM LINE 17 TO 22, NEEDS CORRECTION TO THE EXTENT THAT THE ADDITIONAL INCOME TO BE ADDED IN THE HANDS OF THE ASSESSEE IS EQUIVALENT TO PROFITS ON SUPPRESSED PRODUCTION @ 4% OR ACTUAL GP RATE DECLARED BY THE ASSESSEE WHICHEVER WAS HIGHER. IN VIEW THEREOF, WE PASS THIS CORRIGENDUM ORDER AND THE PARA 88 I.E. FROM LINE 17 TO 22 WOULD NOW BE SUBST ITUTED BY FOLLOWING PARA. 88. ADMITTEDLY, THE ASSESSEE HAD OFFERED ADDITIONAL INCOME ON THE SAID CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY, WHICH IS TO BE ADDED AS INCOME IN THE HANDS OF THE ASSESSEE. THE LEARNED AUTHORIZED REPRE SENTATIVE FOR THE ASSESSEE FAIRLY ADMITTED THAT IN CASE THE SAID ADDITIONAL INCOME HAS NOT BEEN ADDED WHILE COMPUTING THE INCOME IN THE HANDS OF THE ASSESSEE FOR THE RESPECTIVE YEARS, THE SAME MAY BE DIRECTED TO BE ADDED IN THE HANDS OF THE RESPECTIVE ASSE SSEE IN RESPECTIVE YEARS. ACCORDINGLY, WE DIRECT THE ASSESSING OFFICER TO VERIFY FROM THE RECORDS FOR THE RESPECTIVE YEARS AND INCLUDE THE ADDITIONAL INCOME ON ACCOUNT OF SUCH ADMITTED CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT ITA NO . 20 2 0 / PN / 201 4 M/S. MAULI STEEL PVT. LTD. 7 OF EXCISE DUTY, BY THE ASSESSEE EITHER BEFORE THE SETTLEMENT COMMISSION OR BEFORE THE EXCISE AUTHORITIES, IN THE HANDS OF THE ASSESSEE. ACCORDINGLY, WE DIRECT THE ASSESSING OFFICER TO VERIFY FROM THE RECORDS FOR THE RESPECTIVE YEARS AND INCLUDE IN THE HANDS OF ASSESSEE, THE AD DITIONAL INCOME @ 4% OR ACTUAL G.P. RATE DECLARED BY THE ASSESSEE FOR THAT YEAR, WHICHEVER IS HIGHER, ON VALUE OF SUCH ADMITTED CLANDESTINE REMOVAL OF MATERIAL WITHOUT PAYMENT OF EXCISE DUTY, BY THE ASSESSEE BEFORE THE EXCISE AUTHORITIES. THUS, THE ASSESS EE IS DIRECTED TO FILE THE REQUISITE DETAILS OF PROCEEDINGS BEFORE THE EXCISE AUTHORITIES, BEFORE THE ASSESSING OFFICER IN ORDER TO COMPUTE THE ADDITIONAL INCOME IN THE HANDS OF ASSESSEE IN THE RESPECTIVE YEARS. 1 4 . THE ISSUE ARISING BEFORE US IDENTICAL TO THE ISSUE BEFORE THE TRIBUNAL IN SHREE OM ROLLING MILLS PVT. LTD. VS. ADDL. CIT (SUPRA). THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAS STRESSED THAT DURING THE YEAR UNDER CONSIDERATION, NEITHER INVESTIGATION BY THE DGCEI NOR ANY SUPPRESSED PRODUCTION HAS BEEN DETECTED AND ADMITTED BY THE ASSESSEE. FURTHER, THE ASSESSEE HAS NOT MOVED ANY PETITION BEFORE THE SETTLEMENT COMMISSION OR ANY OTHER EXCISE AUTHORITIES. IN THE TOTALITY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES , WE DIRECT THE ASSESS ING OFFICER TO VERIFY THE CLAIM OF ASSESSEE AS TO WHETHER THERE IS ANY CASE ASSESS ING OFFICER TO VERIFY THE CLAIM OF ASSESSEE AS TO WHETHER THERE IS ANY CASE OF CLANDESTINE REMOVAL OF GOODS WITHOUT PAYMENT OF EXCISE DUTY , WHICH INFORMATION HAS BEEN COLLECTED BY THE EXCISE AUTHORITIES . I N CASE THERE IS ANY SUCH INVESTIGATION BY THE DGCE I OR ANY ADMISSION BY THE ASSESSEE BEFORE THE EXCISE AUTHORITIES IN THIS REGARD, THEN THE ASSESSING OFFICER IS DIRECTED TO RESTRICT THE ADDITION BY APPLYING GP RATE @ 4% TO THE VALUE OF GOODS WHICH HAVE BEEN CLANDESTINELY REMOVED, WITHOUT PAYMENT OF EXCISE DUTY. THE NEXT GROUND OF APPEAL RAISED IS AGAINST THE DELETION OF ADDITION MADE ON ACCOUNT OF WORKING CAPITAL REQUIRED FOR PURCHASE OF RAW MATERIALS DOES NOT STAND IN VIEW OF OUR EARLIER ORDERS, AS RELIED UPON IN THE PARAS HEREINABOVE. THE ASSESSEE IS D IRECTED TO FILE COMPOSITE DETAILS BEFORE THE ASSESSING OFFICER. 15. THE REVENUE HAS ALSO RAISED AN ISSUE AS TO WHETHER ANY FURTHER EXPENSES ON ACCOUNT OF MANUFACTURING AND ADMINISTRATION ARE TO BE ALLOWED AGAINST ITA NO . 20 2 0 / PN / 201 4 M/S. MAULI STEEL PVT. LTD. 8 UNACCOUNTED PRODUCTION WORKED OUT IN THE CASE OF ASSESSEE. THERE IS NO MERIT IN THE GROUND OF APPEAL RAISED BY THE REVENUE IN THIS REGARD AS THE GROSS PROFIT IS ESTIMATED ON THE SUPPRESSED SALES AND THE SAME IS APPLIED KEEPING IN MIND THE EXPENSES RELATED TO PRODUCTION. THE GROUND OF APPEAL NO .2 RAISED BY THE REVENUE IS THUS, REJECTED . ACCORDINGLY, THE APPEAL FILED BY THE REVENUE IS DISMISSED AS INDICATED ABOVE. FURTHER, T HE APPLICATION MOVED BY THE ASSESSEE UNDER RULE 27 OF THE INCOME TAX TRIBUNAL RULES, 1963 STANDS ALLOWED. 1 5 . IN THE RESU LT, THE APPEAL OF THE REVENUE IS DISMISSED AND THE APPLICATION MOVED BY THE ASSESSEE UNDER RULE 27 OF THE INCOME TAX TRIBUNAL RULES, 1963 IS ALLOWED. ORDER PRONOUNCED ON THIS 30 TH DAY OF NOVEM BER , 201 6 . SD/ - SD/ - ( ANIL CHATURVEDI ) ( SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; D ATED : 30 TH NOVEM BER , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE C I T (A), AURANGABAD ; 4. / THE C I T , AURANGABAD ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE