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Income Tax Appellate Tribunal, DELHI BENCH ‘B’ : NEW DELHI
Before: SHRI R.K. PANDA & SHRI KULDIP SINGH
PER KULDIP SINGH, JUDICIAL MEMBER : Since common questions of facts and law have been raised in both the aforesaid appeals, the same are being disposed off by way of composite order to avoid repetition of discussion.
Appellant, DCIT, Circle 7 (2), New Delhi (hereinafter referred to as the ‘assessee’) by filing the present appeal sought to set aside the impugned orders both dated 18.07.2016 passed by the Commissioner of Income-tax (Appeals)-3, New Delhi qua the assessment years 2007-08 & 2008-09 on the identical ground inter alia that :-
“Ld. CIT (A) erred in law and on facts of the case in restricting the addition (Rs.2,17,35,677/- to Rs.11,92,892/- and Rs.2,27,84,478/- to Rs.95,75,443/- for AYs 2007-08 & 2008-09 respectively) made by the AO on account of non payment of Excise Duty without appreciating the facts that the Excise Department had challenged the order of the Commissioner of Central Excise, which reduced the liability of the assessee, before the CESTAT.”
Briefly stated the facts necessary for adjudication of the issue at hand are : Originally assessment was framed under section 143 (3) of the Income-tax Act, 1961 (for short ‘the Act’) vide order dated 12.10.2009 & 21.03.2010 at the income of Rs.1,10,10,960/- & Rs.1,00,55,060/- for AYs 2007-08 & 2008-09 respectively.
Subsequently, on receipt of communication from the office of Directorate of Investigation, Central Excise, New Delhi that during the search on the factory premises of the assessee, it is found that they have prepared two sets of accounts and its audit certification is forged and as such, sale contents mentioned in the balance sheet are quite different and by adopting this method, assessee has evaded excise duty to the tune of Rs.18 crores. Then, after reopening, assessment was framed under section 147/143(3) of the Act thereby making addition of Rs.2,17,35,677/- & Rs.2,27,84,478/- for AYs 2007-08 & 2008-09 respectively on account of non-payment of excise duty and on account of making false claim in return of income on the basis of admission made by the assessee during the assessment proceedings.
Assessee carried the matter by way of appeals before the ld. CIT (A) who has restricted the addition from Rs.2,17,35,677/- to Rs.11,92,892/- & from Rs.2,27,84,478/- to Rs.95,75,443/- for AYs 2007-08 & 2008-09 respectively by partly allowing the appeals. Feeling aggrieved, the Revenue has come up before the Tribunal by way of filing the present appeals.
Assessee has not preferred to put in appearance despite issuance of the notice and consequently, we proceeded to decide the present appeal with the assistance of the ld. Senior DR as well as on the basis of documents available on the file.
We have heard the ld. Departmental Representative for the revenue to the appeal who has relied upon the order passed by the AO, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case.
Ld. CIT (A) restricted the addition from Rs.2,17,35,677/- to Rs.11,92,892/- & from Rs.2,27,84,478/- to Rs.95,75,443/- for AYs 2007-08 & 2008-09 respectively on the basis of final order passed by the Commissioner of Central Excise, Delhi – 3 dated 11.07.2014 whereby he has worked out the differential excise duty by returning following findings :-
“Having gone through the submissions of the appellant, order of the assessment made by the Assessing Officer and the material evidences placed on the record, it emerges that the counsel of the appellant submitted the certified copy of the final order passed by the Commissioner Central Excise Delhi-III dated 11.07.2014. The Commissioner Central Excise -III, Delhi has worked out the total differential excise duty at Rs. 6,43,81,944/- at page no. 193 of the final order. The differential excise duty as per the final order for the period of November, 2006 to March, 2007 was Rs. 91,36,385 which was reduced to the extent of Rs.11,92,892/-. The working sheet for the period of November, 2006 to 11th August, 2010 is kept at page no. 18 of the paper book filed on 16.03.2016. In view of this, the addition of Rs.2,17,35,677/- on account of differential excise duty made by the Assessing Officer is restricted to Rs.11,92,892/-. The Assessing Officer is directed to modify the order of assessment accordingly.”
None appeared on behalf of the assessee to assist the Bench. We are of the considered view that the addition has been restricted by the ld. CIT (A) on the basis of order dated 11.07.2014 passed by the Commissioner of Central Excise without recording the fact if the said order dated 11.07.2014 passed by Commissioner of Central Excise has attained finality or has further been challenged before the quasi judicial authority i.e CESTAT. So ,in the circumstances, we are of the considered view that order passed by the ld. CIT (A) is required to be set aside and the file is remanded to the AO to decide afresh after ascertaining as to what has happened before the CESTAT by providing an opportunity of being heard to the assessee. Consequently, aforesaid appeals filed by the Revenue are allowed for statistical purposes Order pronounced in open court on this 25th day of July, 2019.