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TMI Blog2020 (9) TMI 453X X X X Extracts X X X X X X X X Extracts X X X X ..... rder dated 10.06.2015 in ITA No. 645/KOL/2014 was passed by the Tribunal for A.Y. 2009-10 confirming the disallowance of Rs. 12,93,62,086/- made by the Assessing Officer on account of interest on excise duty pertaining to earlier years and claimed for A.Y. 2009-10 on payment basis observing that the same was liable to be allowed either in A.Y. 2008-09 or A.Y. 2013-14 in which the matter relating to central excise had reached finality. Since the assessment proceedings initiated by the Assessing Officer under section 147/148 for A.Y. 2008-09 were open, a petition dated 01.09.2015 was filed by the assessee requesting the Assessing Officer to allow the deduction of Rs. 12,93,62,086/- in A.Y. 2008-09. The assessee also filed a revised computation of income for A.Y. 2013-14 on 04.09.2015 as the regular assessment proceedings for the said year were initiated by the Assessing Officer vide notice issued under section 143(2) of the Act on 04.09.2014. The assessment for A.Y. 2008-09 under section 147/143(3) of the Act was completed by the Assessing Officer vide an order dated 15.01.2016, wherein the deduction of Rs. 12,93,62,086/- claimed by the assessee on account of interest on excise duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise duty pertaining to earlier years. During the course of appellate proceedings before the ld. CIT(Appeals), the following submissions were made on behalf of the assessee in support of his case on this issue:- "The claim is made pursuance to the ITAT order for allowing the claim in AY 2008-09 or 2013-14 when the matter reached finality; (ii) Before the date of search, assessment proceedings for 2013-14 was initiated vide notice u/s. 143(2) dated 04.09.2014; (iii) Claim was made before the AO in the course of regular assessment proceedings along with revise computation of income on 04.09.2015; (iv) A search & seizure took place against the assessee and his group on 22.09.2015; (v) As per section 153A, the assessment proceedings for 2013-14 gets abated and merged with 153A proceedings. Assessee has intimated the AO about the search and abatement of assessment proceedings vide letter dated 30.11.2015; (vi) The order for AY 2008-09 was passed u/s. 147/143(3) on 15.01.2016 in which the said claim of Interest paid on excise duty was not allowed and held as under: "14. The submission of the assessee were examined in the light of records and submissions of the assessee fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er to assess and reassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. In other words there will be one assessment order in respect of each of the six AYs "in which both the disclosed and undisclosed income would be brought to tax". iv. Although Section 153A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post- search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment "can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this section only on the basis of seized material. v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153A is relatable to abated proceedings (i. e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m can be allowed or not. The assessee has stated that at the time of search, it was a pending assessment as notice u/s. 143(2) was already issued. Therefore, in my opinion the assessee's claim can be entertained as it is a case of pending assessment and not of completed assessment. 2nd Question: For consideration is whether interest would be allowable in the AY 2013-14. Since the interest expenditure has crystallized in AY 2013-14 as per Delhi High Court Order, therefore, interest expenditure will be allowable in AY 2013-14. Therefore, the AO is directed to allow interest expenditure in AY 2013-14". 6. Aggrieved by the order of the ld. CIT(Appeals), the Revenue has preferred this appeal before the Tribunal on the following grounds:- "(1) That on the facts and in the circumstances of the case, ld. CIT(A) has erred in allowing appeal of the assessee by holding that the interest expenditure on central excise has crystallized in AY 2013-14. (2) That on the facts and in the circumstances of the case, ld. CIT(A) has erred by violating the order of the Hon'ble ITAT, Kolkata in ITA No. 645/KOL/2014 dated 10.06.2015 wherein it has been clearly mentioned that liability acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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