TaxTMI 
TaxTMI 
2019 (10) TMI 72
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....there can be no Profit on Excise Duty. 5. That the appellant craves leave to add, amend or delete any of the grounds of appeal before the same is finally heard & disposed off. 2. The ld. AR addressing ground Nos. 1 to 3 invited attention to assessment order page 2 para 2 so as to submit that books of account were produced, examined and test-checked. In view of the fact that the assessee expressed his inability to produce Daily Production Register, electricity bills etc. On 12.02.2015 it was submitted the GP rate of the assessee has been tinkered with. Inviting attention to the un-numbered page 3 of the assessment order, it was his submission that the assessee admittedly gave specific reasons why on the said date supporting documents for 2012-13 assessment year could not be produced. For ready reference, said reply is extracted from the record hereunder : "The assessee has already closed its business from during 2012 onwards. The account of the assessee has become NPA. The unit is under the possession of Punjab & Sind Bank, Kukar majra , Mandi Gobindgarh. The assessee has no access to the unit as the same is under lock and key of the bank. In support of the same copy of poss....
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....as submitted that right from the assessment stage, the assessee has been pleading that its business was declared as a nonperforming asset, the factory premises were under lock and key of the bank and the electricity connection also stood discontinued; the fact that in the identical business in Gobind Garh area all similar businesses were facing the situation of dis-connected electricity connection due to business failures which were common facts argued before the AO and well known to the said authority which have been ignored for reasons, best known to the department. 2.4 Inviting attention to the burning loss of the assessee, it was submitted that it was argued and demonstrated to be reasonably compared to the standard burning loss in the industry. The detailed explanation on record, it was submitted, remains uncontested. 2.5 In the said background, it was argued, once the books of account have been audited, explanation why they cannot be produced is verified by the AO himself, these estimated additions cannot be resorted. The department has to being on record some justifiable reason to vary the result unless there is some reason on record to vary the GP. The book results cann....
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....een consumed on various dates but less production has been shown on these dates as per the production details obtained from Central Excise, Range VI, Mandi Gobindgarh by you. Further, there is no consistency in the consumption of electricity units vis-a-vis steel ingots production. The details of production have been tabulated monthwise As per Table below. The Consumption of Electricity in units PMT varies lot. Month Consumption of electricity units as per data supplied by the PSEB Sirhind Production of Steel Ingots as per Central Excise record (MT) Prod. Of steel ingots per unit April,2011 1263300 1173 1076.982 May,2011 1023090 727 1407.276 June,2011 1001880 578 1733.356 July,2011 913440 1053 867.464 August,2011 1070070 1245 859.493 Sept.,2011 1121250 1191 941.435 Oct.,2011 897720 935 960.128 Nov.,2011 1156470 1252 923.698 Dec.2011 1033320 948 1090.000 Jan.,2012 959760 1079 889.490 Feb.,2011 633120 993 637.583 March,2012 312840 694 450.778 Total 11386260 11868 959.408 From the above chart, it is amply clear that there is huge variation in all the consumption of Electricity units and production as per centra....
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.... in a profit making way, there would have been no reason to close the unit. Your honour, is very much aware of the adverse market conditions in the Iron & Steel Industry at Mandi Gobindgarh. Already about 40% of the Industry had closed down its business and the electric connections have been disconnected. Further regarding number of points mentioned by your honour for rejection of books of accounts, it is submitted that the assessee has maintained complete records including daily stock records as prescribed under the Central Excise Rules. Regarding the G.R'S. in respect of Inward & Outward freight, it is submitted that the Inward freight is on account of Scrap purchased by the assessee and is duly supported by G.R'S. Regarding outward Freight, it is submitted that as per practice at Mandi Gobindgarh the ingots are sold on FOR basis by all the units. Thus the outward freight is in respect of sales made by the assessee. The yield of Finished goods is at 91.68%. The resultant figure is not the wastage only but also consists of Runner & Risers which is a bye products and is recycled in manufacturing process. The yield chart is as under:- (i) Finished Goods 91.68% (i....