DCIT, Kanpur V. M/s. Benara Valves Limited,

ITA 412/LKW/2009

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7985 (ITAT-LUCKNOW)
• Duration Of Justice: 5 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-08-2014
• Assessment Year: 2003-2004
• Appeal Filed On: 22-07-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained investment; Opportunity of being heard; Principle of natural justice; Additional evidence
• Section: 143(3); 153A; 147; 68; 69; 148; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER AND SHRI. A. K. GARODIA , ACCOUNTANT MEMBER ITA NO S . 412 AND 41 3 /LKW/2009 ASSESSMENT YEAR S : 2003 - 04 & 2004 - 05 DY. CIT CENTRAL CIRCLE II KA NPUR V. M/S BENARA VALVES LIMITED 15 KM STORE, ARTONI AGRA PAN: AABCB2212R (APP ELL ANT) (RESPONDENT) ITA NO S . 414 AND 415/LKW/2009 ASSESSMENT YEAR S : 2003 - 04 & 2004 - 05 DY. CIT CENTRAL CIRCLE II KANPUR V. M/S BENARA AUTOMOTIVES PVT. LIMITED 15 KM ST ORE, ARTONI AGRA PAN: AABCB2211N (APP ELL ANT) (RESPONDENT) ITA NO S . 68 AND 69 /LKW/2013 ASSESSMENT YEAR S : 2003 - 04 & 2004 - 05 DY. CIT CENTRAL CIRCLE II KANPUR V. M/S BENARA VALVES LIMITED 15 KM STORE, ARTONI AGRA PAN: AABCB2212R (APP ELL ANT) (RESP ONDENT) ITA NO S . 70 AND 71/LKW/2013 ASSESSMENT YEAR S : 2003 - 04 & 2004 - 05 DY. CIT CENTRAL CIRCLE II KANPUR V. M/S BENARA AUTOMOTIVES PVT. LIMITED 15 KM STORE, ARTONI AGRA PAN: AABCB2211N (APP ELL ANT) (RESPONDENT) PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 2 - : APP ELL ANT BY: SHRI. A. K. NIGAM, CIT (DR) RESPONDENT BY: SHRI. S.S. GUPTA, C.A. & SHRI. A. JAISWAL, ADVOCATE DATE OF HEARING: 26 0 8 2014 DATE OF PRONOUNCEMENT: 29 0 8 2014 O R D E R PER BENCH : THESE APPEALS ARE PREFERRED BY THE REVENUE AGAINST THE RESPECTIVE ORDER OF THE LD. CIT(A ) PERTAINING TO ASSESSMENT YEARS 2003 - 04 AND 2004 - 05. 2 . THESE APPEALS ARE EMANATED FROM THE ASSESSMENT ORDER S PASSED IN THE CASES OF M/S BENARA VALVES LIMITED AND M/S BENARA AUTOMOTIVES PVT. LTD. THE ISSUES INVOLVED IN THESE APPEALS ARE ALMOST SIMILAR EXC EPT QUANTUM INVOLVED THEREIN. APPEALS IN I.T.A. NOS.412 TO 415/LKW/2009 ARE EMANATED FROM THE ASSESSMENT ORDERS PASSED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER CALLED IN SHORT THE ACT'); WHEREAS THE OTHER APP EALS IN I.T.A. NOS.68 TO 71/LKW/2013 ARE EMANATED FROM THE ASSESSMENT ORDERS PASSED UNDER SECTION 143(3) READ WITH SECTION 147 OF THE ACT CONSEQUENT TO THE ORDER OF THE LD. CIT(A) PASSED IN APPEALS FILED AGAINST THE ASSESSMENT ORDERS FRAMED UNDER SECTION 1 43(3) OF THE ACT. THEREFORE, THE TRIBUNAL HAS TO ADJUDICATE THE APPEALS FILED AGAINST THE ORDERS OF THE LD. CIT(A) PASSED IN FIRST ROUND AND ALSO IN SECOND ROUND. WE ARE, THEREFORE, OF THE VIEW THAT THE APPEALS EMANATING FROM THE ORIGINAL ASSESSMENT ORDE R ARE TO BE ADJUDICATED FIRST AND WE ACCORDINGLY PREFER TO DEAL WITH THE SAME AT THE THRESHOLD. I.T.A. NOS.412 TO 415/LKW/2009 3 . THE FACTS IN BRIEF ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR ASSESSMENT YEAR 2003 - 04 , THE ASSESSING OFFICER HAS RE CEIVED AN INFORMATION FROM THE CENTRAL EXCISE AUTHORITY THAT THE PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 3 - : ASSESSEE - COMPANY DURING THE YEAR UNDER CONSIDERATION HAS CLANDESTINELY CLEARED THE GOODS OF DIFFERENT VALUES IN ALL THESE FOUR CASES AND THE ASSESSEE VIDE OFFICE LETTER DATED 17.3.2006 WAS AS KED TO SHOW CAUSE AS TO WHY THE VALUE OF GOODS BE NOT CONSIDERED AS SALE OUT OF BOOKS. SUBSEQUENTLY, ASSESSEE MOVED A PETITION BEFORE THE HON'BLE SETTLEMENT COMMISSION, NEW DELHI AND PLEADED BEFORE THE ASSESSING OFFICER THAT NO PROCEEDINGS CAN BE CONTINUE D TILL DISPOSAL OF THE PETITION BEFORE THE HON'BLE SETTLEMENT COMMISSION. ACCORDINGLY , THE ASSESSMENT PROCEEDINGS WERE KEPT IN ABEYANCE. THEREAFTER , THE HON'BLE SETTLEMENT COMMISSION VIDE ORDER DATED 20.12.2007 HAS PASSED AN ORDER UNDER SECTION 245D(2C) OF THE ACT REJECTING THE APPLICATION MOVED BY THE ASSESSEE ON THE GROUND THAT THE ASSESSMENT PROCEEDINGS IN THE S E CASE S HAVE BEEN FINALIZED BY THE DEPARTMENT. THE RELEVANT PART OF THE ORDER OF THE HON'BLE SETTLEMENT COMMISSION DATED 20 .12.2007 AS EXTRACTE D BY THE ASSESSING OFFICER IN HIS ORDER IS REPRODUCED HEREUNDER: - .THE APPLICANTS HAVE INFORMED VIDE LETTER DATED 14/17.12.2007 THAT SINCE THE ASSESSMENT PROCEEDINGS IN THE ABOVE MENTIONED CASES HAVE BEEN FINALIZED BY THE DEPARTMENT, HENCE NO TAX ON AD DITIONAL INCOME DISCLOSED VIDE SETTLEMENT PETITIONS IN THE ABOVE MENTIONED CASES HAS BEEN DEPOSITED. HENCE, WE HOLD THAT THE ABOVE APPLICATIONS ARE TREATED AS NOT VALID. 4 . THIS ORDER WAS RECEIVED BY THE COMMISSIONER OF INCOME TAX (CENTRAL), KANPUR ON 7.1.2 008 AND CONSEQUENT UPON THE RECEIPT OF THE ABOVE ORDER, NO ORDER WAS FOUND AVAILABLE ON RECORD WHICH WAS PURPORTED TO BE FINALIZED BY THE DEPARTMENT. THE ASSESSING OFFICER HAS ALSO NOTED IN HIS ORDER THAT THE HON'BLE SETTLEMENT COMMISSION HAS NOT ENCLOSED ANY ASSESSMENT ORDER ALONG WITH ITS ORDER SENT TO THE COMMISSIONER OF INCOME TAX (CENTRAL), KANPUR. 5 . IN RESPONSE TO THE SHOW CAUSE NOTICE DATED 17.3.2006, ASSESSEE HAS ALSO FILED A REPLY ALONG WITH THE REPLY FILED BEFORE THE CENTRAL EXCISE PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 4 - : AUTHORITIES. IT WAS ALSO CONTENDED BEFORE THE ASSESSING OFFICER THAT THE MATTER IS SUB JUDICE BEFORE THE APPROPRIATE AUTHORITIES OF THE CENTRAL EXCISE DEPARTMENT AT NEW DELHI AND THE MATTER IS LISTED FOR HEARING ON 10.3.2008. THEREFORE THE ASSESSMENT MAY BE FINALIZED A FTER FINALIZATION OF THE PROCEEDINGS BY THE EXCISE AUTHORITIES AT NEW DELHI. THIS REPLY WAS CONSIDERED BY THE ASSESSING OFFICER, BUT HE DID NOT ACCEPT THE CONTENTIONS OF THE ASSESSEE ON THE GROUND THAT THE PROCEEDINGS BEFORE THE EXCISE AUTHORITIES MAY NOT BE FINALIZED TILL RECEIPT OF APPEAL ORDER FROM THE CENTRAL EXCISE AND IT IS A TIME BARRING ASSESSMENT. THEREFORE, THE REQUEST FOR KEEPING THE ASSESSMENT PROCEEDINGS PENDING CANNOT BE ENTERTAINED. THE RELEVANT OBSERVATION OF THE ASSESSING OFFICER IS ALSO EXTRACTED HEREUNDER FOR THE SAKE OF REFERENCE: - IN RESPONSE TO LETTER DATED 17.3.2006, THE ASSESSEE COMPANY FILED DETAILED REPLY WHICH WAS PLACED ON FILE. ON PERUSAL THEREOF, IT IS NOTICED THAT THIS REPLY IS COPY OF REPLY WHICH WAS SUBMITTED BY THE ASSES SEE COMPANY BEFORE THE CENTRAL EXCISE AUTHORITIES AGAINST THEIR SHOW CAUSE NOTICES. THE REPLY IS DATED 12.04 .2005. IT WAS CONCLUDED IN THE REPLY THAT NO ADDITION MAY BE MADE BECAUSE ON ISSUE OF UNDISCLOSED SALES, THE ASSESSEE COMPANY IS SB - JUDICE BEFORE T HE APPROPRIATE AUTHORITY AT NEW DELHI AND THE FINAL HEARING IS FIXED FOR 10.3.2008. IT IS FURTHER SUBMITTED THAT PENDING PROCEEDINGS BEFORE YOUR HONOUR MAY PLEASE BE DECIDED AFTER FINALIZATION OF EXCISE PROCEEDINGS PENDING BEFORE EXCISE AUTHORITIES, NEW DE LHI. THE REPLY OF THE ASSESSEE HAS BEEN PLACED ON FILE. IT WAS NOTICED THAT FACTS AND FIGURES CONTAINED IN THE REPLY WERE EARLIER SUBMITTED TO CENTRAL EXCISE AUTHORITIES. ON GOING THROUGH THE REPLY, IT IS DEDUCED THAT THE CENTRAL EXCISE AUTHORITIES AFTER C ONSIDERING THE REPLY, HAVE DETERMINED THE VALUE OF GOODS AMOUNTING TO RS. 3718578/ - CLANDESTINELY REMOVED FROM THE FACTORY AND LEVIED CENTRAL EXCISE THEREON. THOUGH, IT MAY BE FACT THAT THE ASSESSEE HAS FILED APPEAL AGAINST THE ORDER OF CENTRAL EXCISE. THE ASSESSEE'S CONTENTION THAT PROCEEDINGS MAY NOT BE FINALIZED TILL RECEIPT OF APPEAL ORDER FROM PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 5 - : CENTRAL EXCISE IS NOT ACCEPTABLE AS IT IS A TIME BARRING ASSESSMENT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS NOT FURNISHED ANY DOCUMEN TARY EVIDENCE IN CONTRARY TO VALUE OF GOODS REMOVED CLANDESTINELY AS DETERMINED BY CENTRAL EXCISE AUTHORITIES. IT WAS CONTENDED BY THE ASSESSEE COMPANY THAT ASSESSEE COMPANY IS IN APPEAL AGAINST THE ORDER OF CENTRAL EXCISE AUTHORITIES. SINCE THE MATTER IS SUB - JUDICE BEFORE THE CENTRAL EXCISE AUTHORITIES, WE HAVE LEFT NO OPTION BUT TO COMPLETE ASSESSMENT ON THE BASIS OF INFORMATION AVAILABLE ON RECORD FROM CENTRAL EXCISE AUTHORITIES. 6 . ACCORDINGLY , ON THE BASIS OF THE INFORMATION GATHERED AND ALSO IN THE LIG HT OF THE REPLY FILED BY THE ASSESSEE, THE ASSESSING OFFICER HAS ESTIMATED THE GROSS PROFIT ON THE SUPPRESSED SALES @ 22.95% AS DISCLOSED BY THE ASSESSEE - COMPANY AND ADDED TO THE INCOME OF THE ASSESSEE. THE ASSESSING OFFICER HAS ALSO MADE AN ADDITION ON A CCOUNT OF UNEXPLAINED INVESTMENT IN STOCK FOR CARRYING OUT SUPPRESSED SALES ALSO. BESIDES, OTHER SMALL ADDITIONS WERE ALSO MADE BY THE ASSESSING OFFICER. 7 . THESE ADDITIONS MADE BY THE ASSESSING OFFICER WERE CHALLENGED BEFORE THE LD. CIT(A) ON VARIOUS GROUND S. IT WAS ALSO CONTENDED BEFORE THE LD. CIT(A) THAT THE ASSESSING OFFICER HAS NOT MADE PROPER ENQUIRY FROM THE EXCISE AUTHORITIES WITH REGARD TO THE SUPPRESSED SALES AND WITHOUT REQUISITIONING THE EVIDENCE COLLECTED BY THE EXCISE AUTHORITIES FOR DETERMINI NG THE SUPPRESSED SALES , THE ASSESSING OFFICER HAS MADE AN ADDITION OF PROFIT ON SUPPRESSED SALES MADE OUTSIDE THE BOOKS OF ACCOUNT. BEING CONVINCED WITH THE EXPLANATIONS OF THE ASSESSEE, LD. CIT(A) DELETED THE ADDITIONS ON THE GROUND THAT THE ASSESSING O FFICER OUGHT TO HAVE OBTAINED MATERIAL COLLECTED BY THE EXCISE AUTHORITIES AND ALSO OUGHT TO HAVE MADE NECESSARY ENQUIRIES BEFORE MAKING THE ADDITIONS. THE LD. CIT(A) HAS ALSO OBSERVED IN HIS ORDER THAT THE ASSESSING OFFICER HAS NOT EXAMINED THE PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 6 - : EXPLANATI ONS FURNISHED BY THE ASSESSEE. WHILE DELETING THE ADDITION, LD. CIT(A) HAS ALSO OBSERVED THAT THE ASSESSING OFFICER IS FREE TO TAKE ACTION UNDER THE RELEVANT PROVISIONS OF THE INCOME TAX LAW IN RESPECT OF ANY UNDISCLOSED INCOME OF THE APPELLANT DURING THE RELEVANT YEARS AS PER THE JUDGMENT OF THE JURISDICTIONAL HIGH COURT WHEREIN IT WAS HELD THAT NO SEARCH UNDER SECTION 132 - REQUISITION UNDER SECTION 132A NOT COMPLETE , R EASSESSMENT UNDER SECTION 148 IS VALID. THE RELEVANT DIRECTION OF THE LD. CIT(A) IS E XTRACT E D HEREUNDER FOR THE SAKE OF REFERENCE: - 31. UNDER THE CIRCUMSTANCES AND AFTER CONSIDERING SUBSTANTIAL LACK OF MATERIAL FACTS FOR THE ABOVE AND ALSO IN VIEW OF ARBITRARY AND BASELESS ADDITION MADE IN VIOLATION OF PRINCIPLE OF NATURAL JUSTICE, I FIND THAT THE SAME DESERVES TO BE DELETED. THE DECISION OF THE HON'BLE BENCH IN THE CASE OF HARSINGAR GUTKHA PVT. LTD., THE RELEVANT PART OF WHICH IS REPRODUCED ABOVE, IS TOTALLY APPLICABLE IN THIS CASE. ACCORDINGLY, AS PER FACTS AND CIRCUMSTANCES OF THE CASE, FOR THE REASONS DISCUSSED IN DETAIL AS ABOVE AND AS PER RATIO IN THE CASES NOTED ABOVE, PARTICULARLY IN THE HON'BLE TRIBUNAL'S ORDER ITA NO.93/LUC/04 DATED 25.8.2004 IN THE CASE OF HARSINGAR GUTKHA PVT LTD., THE AO IS DIRECTED TO DELETE THE ADDITION OF RS .8,53,413/ - AND RS.10,07,362/ - FOR ASSESSMENT YEAR 2003 - 04 (RS.15,59,765/ - AND RS.25,49,617/ - FOR A.Y. 2004 - 05). HOWEVER, AT THE SAME TIME IT IS ALSO OBSERVED AND HELD THAT THE AO IS FREE TO TAKE ACTION UNDER RELEVANT PROVISIONS OF INCOME TAX LAW IN RESPEC T OF ANY UNDISCLOSED INCOME OF THE APPELLANT DURING THE RELEVANT YEARS AS PER DECISION IN THE CASE OF CHANDRA PRAKASH AGARWAL VS. ACIT 287 ITR [2006] (ALLD.) OF THE JURISDICTIONAL HIGH COURT, WHERE IT WAS HELD THAT 'NO SEARCH U/S 132 - REQUISITION U/S 132A NOT COMPLETE - REASSESSMENT U/S 148 VALID'. 8 . AGGRIEVED WITH THE ORDER OF THE LD. CIT(A), THE REVENUE HAS PREFERRED AN APPEAL BEFORE THE TRIBUNAL. DURING THE COURSE OF HEARING, THE GROUNDS ORIGINALLY FILED BY THE REVENUE WERE REVISED AND THE REVISED GROUND S OF APPEAL ARE TAKEN ON RECORD. THOUGH THE GROUNDS IN ALL THE PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 7 - : APPEALS ARE ALMOST SIMILAR EXCEPT DIFFERENCE IN QUANTUM, WE EXTRACT THE GROUNDS OF APPEAL RAISED IN I.T.A. NO.412/LKW/2009 HEREUNDER: - 1 . THE LD. CIT(A) WAS NOT JUSTIFIED IN LAW AND ON FACTS IN H OLDING THAT ADDITIONS WERE ARBITRARY BASELESS AND THE PRINCIPLES OF NATURAL JUSTICE WERE VIOLATED IN MAKING THE ADDITION OF RS.8,53,413/ - AND RS.10,07,362/ - WHICH WAS MADE AS A RESULT OF FINDING GIVEN BY THE A.O. THAT GOODS AMOUNTING TO RS.37,18,578/ - WERE SOLD OUTSIDE THE BOOKS OF ACCOUNT, WITHOUT APPRECIATING THE FACT THAT THE A.O. HAS PROVIDED OPPORTUNITY TO THE ASSESSEE BY ISSUE OF SHOW CAUSE NOTICE IN THIS REGARD. 2 . THE LD. CIT (A) WAS NOT JUSTIFIED IN DELETING THE ADDITION OF RS. 8,53,413/ - MADE BY THE A.O. ON ACCOUNT OF PROFIT ON SUPPRESSED SALES, WITHOUT APPRECIATING THE FACT THAT THE ADDITION WAS MADE ON THE BASIS OF INFORMATION RECEIVED FROM CENTRAL EXCISE AUTHORITIES AND THE ASSESSEE WAS PROVIDED ADEQUATE OPPORTUNITY OF BEING HEARD, BY ISSUE OF SHOW CAUSE NOTICE IN THIS REGARD. 3 . THAT LD CIT(A) WAS NOT JUSTIFIED IN DELETING THE ADDITION OF RS.10,07,362/ - MADE BY THE A.O. ON ACCOUNT OF UNEXPLAINED INVESTMENT IN STOCK, WITHOUT APPRECIATING THE FACT THAT THE ADDITION WAS MADE ON THE BASIS OF INFORMATION O BTAINED FROM CENTRAL EXCISE AUTHORITIES AND THE ASSESSEE WAS PROVIDED ADEQUATE OPPORTUNITY OF BEING HEARD, BY ISSUE OF SHOW CAUSE NOTICE IN THIS REGARD. 4 . THAT LD. CIT(A) WAS NOT JUSTIFIED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS 3,00,000/ - MADE BY THE A.O. ON ACCOUNT OF DISCLOSED ADDITIONAL INCOME BEFORE HON'BLE SETTLEMENT COMMISSION, NEW DELHI, WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE ITSELF HAS OFFERED SUCH INCOME AS UNDISCLOSED INCOME BEFORE THE HON'BLE SETTLEMENT COMMISSION AND THAT THE A.O. HAS PASSED THE ASSESSMENT ORDER SUBSEQUENT TO THE ORDER PASSED BY HON'BLE SETTLEMENT COMMISSION U/S PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 8 - : 245D(2C) OF THE ACT, HOLDING THE ASSESSEE'S APPLICATIONS AS INVALID. 5 . THAT THE ORDER OF THE LD. CIT(A) DESERVES TO BE VACATED AND THE ASSESSMENT ORDER P ASSED BY THE ASSESSING OFFICER BE RESTORED. 9 . DURING THE COURSE OF HEARING OF THE APPEAL, THE LD CIT (DR), SHRI. S. K. NIGAM HAS INVITED OUR ATTENTION TO THE FACT THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS IN ALL THESE CASES, THE ASSESSING OFFICER HAS RECEIVED CERTAIN INFORMATION FROM THE CENTRAL EXCISE DEPARTMENT THAT THE ASSESSEE HAS CLANDESTINELY CLEARED CERTAIN G OODS, THEREFORE, THERE WAS SUPPRESSED SALES OUTSIDE THE BOOKS OF ACCOUNT. ON THE BASIS OF THAT INFORMATION, THE ASSESSING OFFICER HAS ISS UED SHOW CAUSE NOTICE TO THE ASSESSEE TO FURNISH ITS EXPLANATION IN THIS REGARD. INSTEAD OF FURNISHING EXPLANATION IN THIS REGARD, ASSESSEE HAS CLAIMED THAT HE HAS APPROACHED THE HON'BLE SETTLEMENT COMMISSION, THEREFORE, TILL DECISION OF THE HON'BLE SETTL EMENT COMMISSION, THE PROCEEDINGS BE KEPT IN ABEYANCE AND ACCORDINGLY PROCEEDINGS WERE KEPT IN ABEYANCE. WHEN THE ORDER OF THE HON'BLE SETTLEMENT COMMISSION DATED 22.12.2007 WAS RECEIVED IN THE OFFICE OF THE COMMISSIONER OF INCOME TAX (CENTRAL), KANPUR ON 7.1.2008, THE ASSESSING OFFICER HAS VERIFIED THE RECORDS, BUT COULD NOT LOCATE ANY ORDER WHICH WAS FINALIZED ACCORDING TO THE ASSESSEE AND REFERRED IN THE ORDER OF THE HON'BLE SETTLEMENT COMMISSION. THEREAFTER , THE ASSESSING OFFICER HAS AGAIN INITIATED P ROCEEDINGS TO COMPLETE THE ASSESSMENT AND ASSESSEE AGAIN RAISED A PLEA BEFORE THE ASSESSING OFFICER THAT THE PROCEEDINGS BE KEPT IN ABEYANCE TILL A DECISION IS TAKEN BY THE EXCISE AUTHORITIES, AS THE MATTER IS LISTED FOR HEARING ON 10.3.2008 BEFORE THE COM MISSIONER, EXCISE DEPARTMENT, NEW DELHI. THE ASSESSING OFFICER HAS NOTED THEREIN THAT THE PROCEEDINGS CANNOT BE KEPT IN ABEYANCE AS IT IS A TIME BARRING ASSESSMENT AND HE ACCORDINGLY TURNED DOWN THE REQUEST OF THE ASSESSEE AND COMPLETED PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 9 - : THE ASSESSMENT ON THE BASIS OF THE INFORMATION RECEIVED FROM THE EXCISE DEPARTMENT AND ALSO THE EXPLANATIONS FURNISHED BY THE ASSESSEE. 10 . THE LD. CIT (DR) HAS FURTHER CONTENDED THAT THE ASSESSING OFFICER WAS NOT ALLOWED TO MAKE NECESSARY ENQUIRY WITH REGARD TO THE SUPPRESSED SALES AS REFERRED BY THE EXCISE DEPARTMENT TO THE INCOME - TAX AUTHORITIES . THE ASSESSEE RATHER COULD NOT PLACE TH E ASSESSMENT ORDER WHICH WAS FINALIZED AS REFERRED BY THE HON'BLE SETTLEMENT COMMISSION . ALL THESE QUERIES ARE TO BE ANSWERED BY THE ASSESSEE. HE HAS ALSO INVITED OUR ATTENTION TO THE REPLY DATED 12.4.2005 FILED BEFORE THE ASSESSING OFFICER WITH THE SUBMISSION THAT IN THIS REPLY , ASSESSEE HAS NOT FURNISHED ANY EXPLAN A TION WITH REGARD TO THE SUPPRESSED SALES DETECTED BY THE EXCISE AUTHORITIES. T HE LD. CIT(A) , W HILE DELETING THE ADDITIONS , HAS NOT EXAMINED THIS ASPECT THAT THE ASSESSING OFFICER WAS NOT ALLOWED TO MAKE NECESSARY ENQUIRIES WHILE COMPLETING THE ASSESSMENT. HE WAS ALL THE TIME REQUESTED BY THE ASSESSEE TO KEEP THE PROCEEDINGS IN ABEY ANCE , AS THE MATTER WAS PENDING WITH THE HON'BLE SETTLEMENT COMMISSION OR BEFORE THE APPROPRIATE AUTHORITIES OF THE EXCISE DEPARTMENT. THE LD. CIT(A) IN HIS ENTIRE ORDER HAS REPRODUCED THE ASSESSMENT ORDER AS WELL AS THE SUBMISSIONS MADE BY THE ASSESSEE. HE HAS NOT EVEN CALLED A REMAND REPORT FROM THE ASSESSING OFFICER ON THE ADDITIONAL EVIDENCE FILED BEFORE HIM OR THE EXPLANATIONS FURNISHED BEFORE HIM. HE HAS OUT RIGHTLY DELETED THE ADDITIONS AND WHILE DELETING THE SAME, HE HAS ALLOWED THE ASSESSING OFF ICER TO TAKE ACTION UNDER THE RELEVANT PROVISIONS OF THE ACT BY GIVING AN INDICATION THAT ASSESSMENT CAN BE REOPENED UNDER SECTION 147 OF THE ACT, BUT WHEN THE ASSESSMENT WAS REOPENED BY THE ASSESSING OFFICER UNDER SECTION 147 OF THE ACT PURSUANT TO THE OR DER OF THE LD. CIT(A), THAT RE - ASSESSMENT WAS ALSO KNOCKED DOWN BY THE LD. CIT(A) BY HOLDING THAT THE REOPENING WAS NOT VALID. THE LD. CIT (DR) HAS FURTHER CONTENDED THAT THE DELETION OF ADDITIONS BY THE LD. CIT(A) WAS WITHOUT REALIZING THE FACT THAT THE ASSESSING OFFICER WAS NOT ALLOWED TO CONDUCT THE ASSESSMENT PROCEEDINGS PROPERLY AND WAS PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 10 - : ALWAYS STOPPED FROM DOING NECESSARY ENQUIRIES ON ONE REASON OR THE OTHER. THEREFORE, IN THE INTEREST OF JUSTICE, THE MATTER MAY BE RESTORED TO THE ASSESSING OFFICER A FTER SETTING ASIDE THE ORDER S OF THE LD. CIT(A). 11 . THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, HAS PLACED HEAVY RELIANCE UPON THE ORDER OF THE LD. CIT(A). IT WAS FURTHER CONTENDED THAT THE ASSESSING OFFICER WITHOUT MAKING ANY ENQUIRY HAS MADE THE A DDITIONS IN THE HANDS OF THE ASSESSEE ON ACCOUNT O R SUPPRESSED SALES. THE ASSESSING OFFICER OUGHT TO HAVE CALLED EVIDENCE O R THE SEIZED MA TERIAL COLLECTED BY THE EXCISE A UTHORITIES BEFORE MAKING THE ADDITIONS IN THE HANDS OF THE ASSESSEE. THEREFORE, THE LD. CIT(A) HAS RIGHTLY DELETED THE ADDITIONS, AS IT WAS NOT DONE AFTER MAKING A PROPER ENQUIRY. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER CONTENDED THAT THE SEIZED MATERIAL WAS REQUISITIONED BY THE ASSESSING OFFICER IN SECOND ROUND OF APPEAL, THEREFORE , THE ASSESSMENT UNDER SECTION 153A OF THE ACT IS POSSIBLE AND NOT A REGULAR ASSESSMENT UNDER SECTION 143(3) OF THE ACT. HE HAS ALSO INVITED OUR ATTENTION TO THE REPLIES FILED BEFORE THE ASSESSING OFFICER WITH THE SUBMISSION THAT HE HAS DULY EXPLAINED THA T NO SUPPRESSED SALE WAS EFFECTED. 12 . HAVING GIVEN A THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF THE ORDERS OF THE AUTHORITIES BELOW, WE FIND THAT UNDISPUTEDLY DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFIC ER HAS RECEIVED INFORMATION FROM THE EXCISE AUTHORITIES THAT THE ASSESSEE HAS CLANDESTINELY CLEARED THE GOODS OF DIFFERENT VALUES IN DIFFERENT ASSESSMENT YEARS. ON THE BASIS OF THIS INFORMATION, ASSESSEE WAS ASKED TO SHOW CAUSE AS TO WHY THE VALUE OF GOOD S BE NOT CONSIDERED AS SALE S OUT OF BOOKS. THOUGH ASSESSEE HAS CLAIMED THAT IT HAS FILED A REPLY TO THIS NOTICE , WHICH IS APPEARING AT PAGES 21 TO 24 OF THE SECOND COMPILATION OF THE ASSESSEE, BUT FROM A PERUSAL OF THIS REPLY WE FIND THAT THE REPLY WAS DA TED 12.4.2005. THEREFORE, IT CANNOT BE SAID THAT THIS REPLY WAS FILED TO PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 11 - : THE SHOW CAUSE NOTICE DATED 17.3.2006. EXCEPT THIS REPLY, OUR ATTENTION WAS NOT INVITED TO ANY OTHER REPLY , WHICH WAS CLAIMED TO HAVE BEEN FILED BEFORE THE ASSESSING OFFICER. THO UGH THE ASSESSEE HAS CLAIMED THAT IT HAS FILED THE REPLY FILED BEFORE THE EXCISE AUTHORITIES BUT THAT REPLY IS ALSO DATED 13.4.2005. MOREOVER, ON A CAREFUL PERUSAL OF THIS REPLY ALSO, WE DO NOT FIND ANY PROPER EXPLANATION OR JUSTIFICATION WITH REGARD TO T HE SUPPRESSED SALES AS NOTED BY THE ASSESSING OFFICER ON THE BASIS OF INFORMATION RECEIVED FROM THE EXCISE DEPARTMENT. IT IS ALSO OBVIOUS FROM THE ASSESSMENT ORDER THAT DURING THE PENDENCY OF THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER WAS ALSO ASKE D TO KEEP THE PROCEEDINGS IN ABEYANCE AS THE MATTER IS SUB JUDICE BEFORE THE HON'BLE SETTLEMENT COMMISSION AND THE ASSESSING OFFICER WAS CONSTRAINED TO KEEP THE ASSESSMENT PROCEEDINGS IN ABEYANCE. THEREAFTER , THE HON'BLE SETTLEMENT COMMISSION HAS PASSED A N ORDER UNDER SECTION 245D(2C) OF THE ACT VIDE ORDER DATED 20.12.2007. IN THIS ORDER, THE HON'BLE SETTLEMENT COMMISSION HAS MADE A REFERENCE THAT ASSESSEE HAS INFORMED VIDE LETTER DATED 17.12.2007 THAT SINCE THE ASSESSMENT PROCEEDINGS IN THE ABOVE MENTION ED CASE HAS BEEN FINALIZED BY THE INCOME - TAX DEPARTMENT , HENCE NO TAX ON ADDITIONAL INCOME IN THE ABOVE CASE HAS BEEN DEPOSITED. ON THE BASIS OF THIS, THE HON'BLE SETTLEMENT COMMISSION TREATED THE APPLICATION MOVED BY THE ASSESSEE NOT VALID . W HEN THE ORD ER WAS RECEIVED IN THE OFFICE OF THE COMMISSIONER OF INCOME TAX (CENTRAL), KANPUR, THE ASSESSING OFFICER HAS ALSO MADE NECESSARY ENQUIRY FROM THE ASSESSEE WITH REGARD TO THE ASSESSMENT ORDER WHICH WAS THE SUBJECT MATTER BEFORE THE HON'BLE SETTLEMENT COMMI SSION AND WAS FINALIZED ACCORDING TO HIM VIDE LETTER DATED 14/17.12.2007, BUT THE ASSESSEE COULD NOT FURNISH THE SAME EITHER BEFORE THE ASSESSING OFFICER OR EVEN BEFORE US DURING THE COURSE OF HEARING OF THE APPEAL. THEREAFTER , THE ASSESSING OFFICER HAS F URTHER INITIATED ASSESSMENT PROCEEDINGS AND AGAIN ASSESSEE HAS TAKEN A STAND BEFORE THE ASSESSING OFFICER THAT THE ASSESSMENT PROCEEDINGS BE KEPT IN ABEYANCE T ILL DISPOSAL OF THE APPEALS PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 12 - : PENDING BEFORE THE COMMISSIONER, EXCISE DEPARTMENT AND IS FIXED FOR H EARING ON 10.3.2008. SINCE IT WAS A TIME BARRING ASSESSMENT, THE ASSESSING OFFICER WAS CONSTRAINED TO COMPLETE THE ASSESSMENT BEFORE 31.3.2008 AND HE ACCORDINGLY COMPLETED THE ASSESSMENT ON THE BASIS OF THE INFORMATION RECEIVED FROM THE EXCISE AUTHORITIES AND WHATEVER EXPLANATIONS FURNISHED BEFORE HIM BY THE ASSESSEE. 13 . WHEN THE MATTER WAS REACHED TO THE LD. CIT(A) , HE HAS NOT EXAMINED THIS ASPECT AND THE CIRCUMSTANCES UNDER WHICH THE ASSESSING OFFICER HAS PASSED THE ASSESSMENT ORDER. HE HAS SIMPLY SET ASID E THE ADDITIONS ON THE BASIS THAT THE ASSESSING OFFICER OUGHT TO HAVE MADE NECESSARY ENQUIRIES OR COLLECTED MATERIAL FROM THE EXCISE AUTHORITIES. THE ASSESSING OFFICER COULD HAVE DONE SO IF THE TIME PERMITS. ALL THE TIME HE WAS RESTRAINED FROM COMPLETING THE ASSESSMENT BY MAKING NECESSARY ENQUIRIES BY ONE REASON OR THE OTHER. THEREFORE, THE ASSESSING OFFICER CANNOT BE HELD RESPONSIBLE FOR THE LAPSES IN THE ENQUIRY CONDUCTED WHILE COMPLETING THE ASSESSMENT IN THIS REGARD. THE LD. CIT(A) OUGHT TO HAVE CAL LED REMAND REPORT FROM THE ASSESSING OFFICER WITH REGARD TO THE ADDITIONAL EVIDENCE OR THE EXPLANATIONS FILED BY THE ASSESSEE BEFORE HIM. HE SHOULD HAVE AFFORDED AN OPPORTUNITY TO THE ASSESSING OFFICER TO CONDUCT NECESSARY ENQUIRY WITH REGARD TO THE INFOR MATION RECEIVED FROM THE EXCISE DEPARTMENT FOR SUPPRESSED SALES OUTSIDE THE BOOKS OF ACCOUNT. BUT THE LD. CIT(A) DID NOT AFFORD ANY OPPORTUNITY TO THE ASSESSING OFFICER AND HAS DELETED THE ADDITIONS ON THE BASIS OF EXPLANATIONS FURNISHED BY THE ASSESSEE , HAVING OBSERVED THAT THE ASSESSING OFFICER HAS NOT MADE NECESSARY ENQUIRIES BEFORE MAKING THE ADDITIONS. SINCE THE LD. CIT(A) HAS NOT TAKEN INTO ACCOUNT THE COMPLETE EVENTS AND THE FACTS OF THE CASE AND THE CIRCUMSTANCES UNDER WHICH ASSESSMENT WAS COMPLET ED, WE DO NOT SUBSCRIBE HIS VIEWS AND WE ACCORDINGLY SET A S I DE HIS ORDER. BUT IN ANY CASE , WE ARE ALSO OF THE VIEW THAT NECESSARY ENQUIRY WAS NOT CONDUCTED AT THE LEVEL OF THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT ON PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 13 - : ACCOUNT OF CERTAIN REASONS . THEREFORE, WE SET ASIDE THE ORDER S OF THE LD. CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO MAKE NECESSARY ENQUIRIES WITH REGARD TO THE SUPPRESSED SALES EITHER FROM THE EXCISE DEPARTMENT OR FROM THE ASSESSEE. IF NEED BE , THE RELEVANT EVIDENCE MAY ALSO BE OBTAINED FROM THE EXCISE DEPARTMENT ON THE BASIS OF WHICH THEY HAVE CONCLUDED THAT ASSESSEE HAS CLANDESTINELY CLEARED THE GOODS OF DIFFERENT VALUES. NEEDLESS TO MENTION HERE THAT PROPER OPPORTUNITY OF BEING HEARD MAY BE AFFORDED TO THE ASSESSEE. ACCORDINGLY, THESE APPEALS ARE DISPOSED OF. I.T.A. NO.S68 TO 71/LKW/2013: 14 . THESE APPEALS ARE EMANATED FROM THE ASSESSMENT ORDERS FRAMED CONSEQUENT TO THE ORDERS OF THE LD. CIT(A) IN THE FIRST ROUND. THE ORDERS OF THE LD. CIT(A) IN THE FIRST ROUND HAS BEEN SET ASIDE AND THE MATTER HAS BEEN RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR RE - ADJUDICATION OF THE IMPUGNED ISSUES AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEES. SINCE THE LD. CIT(A)S ORDERS ARE S ET ASIDE, THE ASSESSMENT ORDERS FRAMED CONSEQUENT THERETO HAS NOT LEG TO STAND AND ACCORDINGLY WE SET ASIDE THE SUBSEQUENT ASSESSMENT S AND THE ORDERS OF THE LD. CIT(A). 15 . IN THE RESULTS, ALL THE APPEALS OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENT I ONED ON THE CAPTION PAGE. SD/ - SD/ - [ A. K. GARODIA ] [ S UNIL KUMAR Y ADAV ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 29 TH AUGUST , 2014 JJ: 2608 PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ ) : - 14 - : COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR PRINT TO PDF WITHOUT THIS MESSAGE BY PURCHASING NOVAPDF ( HTTP://WWW.NOVAPDF.COM/ )