JUDGMENT
Ajit K. SenguPta, J.
1. In this reference under Section 256(2) of the Income-tax Act, 1961, for the assessment years 1977-78, 1979-80 and 1980-81, the following question of law has been referred to this court :
“Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the amounts of Rs. 1,00,45,592, Rs. 45,22,346 and Rs. 4,23,706 were deductible on account of excise duty liability for the assessment years 1977-78, 1979-80 and 1980-81?”
2. The brief facts are that the assessee-company claimed deduction of Rs. 3,11,62,220, Rs. 45,22,346 and Rs. 1,05,20,682 for the assessment years 1977-78, 1979-80 and 1980-81, respectively, as excise duty liability on the basis of a show-cause notice dated December 9, 1976. The Income-tax Officer found that the notice dated December 9, 1976, was a mere show-cause notice and it did not create any liability. The Income-tax Officer also found that a Civil Rule No. 8372(C) of 1978 was pending before the High Court and, as per the order of the High Court, the Central Excise authority was then restrained from levying any such duty pending disposal of the rule. The Income-tax Officer, therefore, held that no liability in respect of Central Excise duty accrued or arose in the previous year. Hence, he disallowed the claim of the assessee for all the three assessment years.
3. The assessee, being aggrieved by the order of the Income-tax Officer, agitated the dispute before the Commissioner of Income-tax (Appeals). The Commissioner of Income-tax (Appeals), after hearing the contentions of the assessee, held that the assessee-company was entitled to deduction of Rs. 1,00,45,592, Rs. 45,22,346 and Rs. 4,23,706 for the assessment years 1977-78, 1979-80 and 1980-81, respectively, on account of excise duty liability in respect of the goods manufactured by the assessee-company during the relevant accounting periods.
4. The Department then preferred a second appeal before the Tribunal against the decision of the Commissioner of Income-tax (Appeals). The Tribunal, after considering the facts and circumstances of the case and following the decision of the Calcutta High Court in the case of CIT v. Century Enka Ltd. [1981] 130 ITR 267, held that the Commissioner of Income-tax (Appeals) was perfectly justified in allowing the excise duty liabilities for the assessment years in question. The Tribunal confirmed the order of the Commissioner of Income-tax (Appeals). It is this order of the Tribunal which gives rise to the proposed common question of law.
5. It is not in dispute that this question is now concluded by the decision of this court in the case of CIT v. Century Enka Ltd. [1981] 130 ITR 267. As a matter of fact, a similar question regarding deductibility of excise duty where the assessee challenged the levy of such duty came up for consideration before this court in I. T. Reference No. 28 of 1991 in the case
of CIT v. India Foils Ltd. [1993] 200 ITR 259, where the judgment was delivered on November 28, 1991. Following the aforesaid decisions, we answer the question in this reference in the affirmative and in favour of the assessee.
6. There will be no order as to costs.
Shyamal Kumar Sen, J.
7. I agree.