R.R. KABEL LTD, V. ADDL CIT 7(2),

MA 530/MUM/2012

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 9477 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 1 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 16-11-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2007-2008
• Appeal Filed On: 14-08-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: R R VORA
• Keywords: Business income
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, D, MUMBAI BEFORE S/SHRI DINESH KUMAR AGARWAL, JM AND RAJENDRA , AM M.A. NO. 530/MUM/2012 ARISING OUT OF ITA NO. 1292/MUM/2011 (ASSESSMENT YEAR 2007-08) R.R. KABEL LTD., RAM RATNA HOUSE, VICTORIA MILL COMPOUND, P.B. MARG, WORLI, MUMBAI- 400 013. PAN: AABCR3352C ADDL. COMMISSIONER OF INCOME- TAX 7(2), 6 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI- 400020. APPLICANT V/S RESPONDENT DATE OF HEARING : 16- 11-2012 DATE OF PRONOUNCEMENT : 16-11-201 2 APPLICANT BY : SHRI R .R. VORA & SHRI NIKHIL TIWARI RESPONDENT BY : SHRI DINESH KUMAR O R D E R PER DINESH KUMAR AGARWAL (JM) THIS MISC. PETITION DTD. 7-8-2012 FILED BY THE ASSE SSEE IS DIRECTED AGAINST THE ORDER DTD. 2-5-2012 PASSED BY THE TRIBU NAL IN ITA NO. 1292/MUM/2011 FOR THE A.Y. 2007-08. 2. IN THIS MISC. PETITION, AFTER GIVING BRIEF BACK GROUND OF THE CASE, IT WAS CONTENDED THAT THE TRIBUNAL WHILE DECIDING GROUND N OS. 1 & 2 AGAINST THE SUSTENANCE OF ADJUSTMENT OF EXCISE DUTY AND VAT MAD E U/S 145A OF THE INCOME TAX ACT, 1961 (THE ACT) DELETED THE ADDITION OF RS. 1,13,19,681/- WHICH WAS NOT BEFORE THE TRIBUNAL AND SET ASIDE THE ADDITION TO THE FILE OF THE A.O. AMOUNTING TO RS. 2,83,50,504/- FOR EXCISE DUTY , RS. 4,48,190/- FOR VAT AND RS. 2,00,000/- FOR VAT ON CLOSING STOCK WHEREAS THE LD. CIT(A) HAS REDUCED THE ADDITION OF EXCISE DUTY FROM RS. 2,83,5 0,504/- TO RS. MA 530/MUM/2012 2 1,81,70,494/-, ADDITION OF VAT FROM RS. 4,48,190/- TO RS. 3,43,285/- AND DELETED THE ADDITION OF RS. 2,00,000/- VAT ON CLOSI NG STOCK, THEREFORE, BY SETTING ASIDE THE ABOVE ADDITIONS TO THE FILE OF TH E A.O., THE ASSESSEES CASE BECOME WORSE OFF THAN WHAT WAS ALLOWED BY THE LD. C IT(A), THEREFORE, THE ORDER PASSED BY THE TRIBUNAL ON THIS ISSUE MAY BE SUITABL Y RECTIFIED. 3. AT THE TIME OF HEARING THE LD. COUNSEL FOR THE A SSESSEE WHILE REITERATING THE SAME SUBMISSIONS AS SUBMITTED IN THE MISC. PETI TION SUBMITS THAT IN VIEW OF THE CHART APPEARING AT PAGE 5 OF THE MISC. PETIT ION, THERE IS A MISTAKE IN THE ORDER OF THE TRIBUNAL AND, THEREFORE, THE SAME MAY BE RECTIFIED WHICH WAS NOT OBJECTED TO BY THE LD. D.R. 4. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RIVAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND T HAT THE GROUND NOS. 1&2 TAKEN BY THE ASSESSEE ARE AGAINST THE ADJUSTMENT OF EXCISE DUTY AND VAT U/S 145A OF THE ACT. WE FURTHER FIND THAT THE LD. CIT( A) ON THE ABOVE ISSUE HAS HELD AS UNDER (PARA 2, PAGE 8) :- IT IS THEREFORE HELD AS UNDER: I) RESULTANT CHANGE, IF ANY WILL HAVE TO BE ADDED TO THE ASSESSEES INCOME. II) ANOMALY MAY ARISE BECAUSE OF THE FACT THAT THE ASSE SSEE HAS UTILIZED PLA ACCOUNT INSTEAD OF CENVAT/VAT CREDIT AVAILABLE FOR PAYMENT OF THE DUTY TO THE GOVT. ACCOUNT. THE AMOUNT OF PAYME NT MADE OUT OF THE PLA ACCOUNT TO THE EXTENT OF THE CENVAT/VAT CRE DIT WAS STILL AVAILABLE IN THE CENVAT/VAT REGISTER SHALL BE ADDED TO THE CENVAT /VAT SET OFF/UTILIZED DURING THE YEAR AS ABOVE. III) VAT IS PAYABLE AT THE TIME OF SALES AND NOT ON CLOS ING STOCK OF FINISHED GOODS. IV) THE ADDITION ON ACCOUNT OF DUTY FOLLOWING THE PROVI SIONS OF SECTION 145A IS PRINCIPALLY CALLED FOR. NO ADJUSTMENT IN T HE OPENING STOCK IS POSSIBLE AS HELD IN THE CASE OF MELMOULD CORPORATIO N V/S CIT 202 ITR 789 (BOM). BESIDES, TAX PROVISIONS U/S 145A CAME I NTO EFFECT FROM MA 530/MUM/2012 3 1.4.1998, AY 2007-08 CANT BE SAID TO BE TRANSITION AL YEAR. HENCE THE JUDGMENT OF MAHAVIR ALUMINIUM LTD. 297 ITR 77 (DEL) SHALL NOT APPLY. V) IN VIEW OF THE AFORESAID DIRECTIONS, NO SEPARATE AD DITION IN RESPECT OF THE AMOUNT OF RS. 1,13,19,681/- AS CALLED FOR. VI) THE ASSESSING OFFICER IS DIRECTED TO VERIFY THESE F ACTS AND FIGURES AND MAKE ADDITION AS PER AFORESAID DIRECTIONS. 5. WE FURTHER FIND THAT THE A.O. VIDE ORDER DTD. 8- 3-2011 GIVING EFFECT TO THE ORDER OF LD. CIT(A) READ WITH ORDER PASSED U/S 154 DTD. 10-10-2011 HAS CALCULATED THE RELIEF ALLOWED BY THE LD. CIT(A) ON THIS ACCOUNT AS UNDER:- I) BUSINESS INCOME AS PER ORDER GIVING EFFECT TO CIT(A)S ORDER DATED 8-3-2011 13,67,47,092 LESS RELIEF ALLOWED BY CIT(A) I) ADDITION OF RS. 1,13,19,681 RELATED TO EXCISE DUTY ( [PG.8, PT.(V) OF CIT(A)S ORDER] 1,13,19,681 II) ADDITION OF RS. 2,00,000 RELATED TO VAT [ PG.8, PT. (III) OF CIT(A)S ORDER] 2,00,000 III) EFFECT OF THE ORDER OF CIT(A) FOR EXCISE/MODVAT/CENVAT U/S 145A {2,83,50,504 1,81,70,494 ( AS PER THE WORKING ATTACHED ) 1,01,80,010 IV) EFFECT OF THE ORDER OF CIT(A) FOR VAT U/S 145A { 4,48,190 3,43,285 (AS PER WORKING ATTACHED) 1,04,905 2,18,04,596 BUSINESS INCOME 11,49,42,496 6. IN THE ABSENCE OF ANY CLEAR FINDING AND THE AMOU NT IN DISPUTE, THE TRIBUNAL WITHOUT CONSIDERING THE ABOVE ORDERS PASSE D BY THE A.O. WHILE UPHOLDING THE ORDER OF THE LD. CIT(A) IN DELETING T HE ADDITION OF RS. 1,13,19,681/- HAS RESTORED THE OTHER ISSUES TO THE FILE OF THE A.O. SINCE THE LD. CIT(A) HAS ALLOWED SUBSTANTIAL RELIEF TO THE AS SESSEE AS MENTIONED ABOVE, WE ARE OF THE VIEW THAT THERE IS AN APPARENT MISTAK E IN THE ORDER OF THE TRIBUNAL IN TERMS OF THE PROVISION OF SECTION 254( 2) OF THE ACT AND ACCORDINGLY WE RECALL OUR ORDER FOR THE LIMITED PURPOSE IN RESP ECT OF GROUND NOS. 1 & 2 TAKEN BY THE ASSESSEE. THE DATE IS FIXED FOR HEARIN G ON 07-01-2013 AS MA 530/MUM/2012 4 ANNOUNCED IN THE OPEN COURT. THE MISC. PETITION FI LED BY THE ASSESSEE IS, THEREFORE, PARTLY ALLOWED. 7. IN THE RESULT, THE MISC. PETITION FILED BY THE A SSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16-11-2012. SD/- SD/- (RAJENDRA) (DINESH KUMAR AGARWAL) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED : 16-11-2012 RK.: COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT , CONCERNED, MUMBAI 4. CIT(A) CONCERNED, MUMBAI 5. DR D BENCH 6. GUARD FILE. BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI