The Commissioner Of Income Tax-I v. M/S Arora Alloys Ltd

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No.461 of 2009 (O&M)Date of decision: 23.10.2009 The Commissioner of Income Tax-I. Vs. M/s Arora Alloys Ltd. -----Appellant -----Respondent CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOELHON'BLE MR. JUSTICE GURDEV SINGH Present:-Mr. Rajesh Sethi, Standing Counsel for the revenue.for the revenue. ORDER: Mr. S.K. Mukhi, Advocatefor the assessee.----- 1. The revenue has preferred this appeal under Section260-A of the Income Tax Act, 1961 (for short, “the Act”) againstorder dated 11.07.2008 passed by the Income Tax AppellateTribunal, Chandigarh Bench ‘A’, Chandigarh in I.T.A. No.319/Chandi/2008 for the assessment year 2004-05, proposing to raisefollowing substantial question of law:- “Whether on the facts and law the Hon’ble Tribunalwas justified in setting aside the order of AO withdirection to frame fresh assessment on the basis ofdecision of Excise Tribunal in regard to appeal filed bythe Customs and Excise Department ignoring the factthat proceedings before Excise Tribunal are not barred by limitation whereas fresh assessment asdirected by ITAT will be barred by limitation on31.12.2009 as per section 153 of the Income Tax Act,1961.” 2. The Assessing Officer initiated proceedings for re-assessment and made certain additions to the declared income ofthe assessee. Basis for re-assessment was proceedings underthe Central Excise Act showing clandestine removal of stocks,outside the books of account. The CIT(A) deleted the saidadditions, taking into account finding of higher authority inproceedings under the Central Excise Act. On further appeal, theTribunal directed framing of fresh assessment keeping in viewjudgment of this Court inCITv. K.S. Bhatia257 ITR 614, afterthe Excise Tribunal decided the appeal of the department. 3. We have heard learned counsel for the parties. 4. Learned counsel for the revenue submits that thejudgment of this Court inK.S. Bhatia (supra), relied upon by theTribunal was not applicable, as in that case the finding which wasrelied upon, as information for re-assessment, had been set asideby the higher authority. The assessing authority could not berequired to wait till decision of the Excise Tribunal, by which timeproceedings may become time barred. Proceedings under theCentral Excise Act had relevance only for formation of opinion ofescapement of income and thereafter, the authorities had toindependently finalise re-assessment irrespective of final view in excise proceedings. Learned counsel for the assessee is notable to rebut the submission and in a way supports the view thatmatter should have been finalised on merits. Question of law isanswered accordingly by holding that the Tribunal was notjustified in directing that the matter be kept pending till thedecision of the Tribunal. 5. Accordingly, this appeal is allowed, impugned order ofthe Tribunal is set aside and the matter is remanded to theTribunal for fresh decision on merits in accordance with law. 6. Parties may appear before the Tribunal for furtherproceedings on 14.1.2010. (ADARSH KUMAR GOEL) JUDGE October 23, 2009ashwani ( GURDEV SINGH ) JUDGE