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2012 (10) TMI 88 - ITAT AHMEDABADLoss due to cancellation of forward contract - dis-allowance on ground of it being speculative transaction - Held that:- Loss due to cancellation of forward contract is revenue expenditure and thus allowable expenditure - Decided against Revenue Addition on account of late payment of employees contribution to PF - Held that:- PF contribution of employer and employee was deposited within grace period, though and well before filing of due date of income tax return. No ground for disallowing the same -Decided against Revenue Addition on account of excise duty not included in the valuation of closing stock of finished goods - Held that:- Closing stock has to be valued, at the option of the assessee, at cost or market price, whichever is lower. Duty of Central excise is levied on the goods manufactured, i.e. excisable goods manufactured by an assessee. It is not a part of manufacturing cost. It can be termed a post-manufacturing cost. Therefore, unless and until it is entered on one side, as an item of cost, it cannot be taken as a component of the value of the closing stock on the other side. Hence, excise duty is to be excluded at the time of valuation of closing stock of finished goods at the end of account period - Decided against Revenue Addition of expenditure incurred on repairs and maintenance treated as capital expenditure - Held that:- CIT(A) has given a finding of fact that the expenditure were incurred on account of maintenance of the existing plant and machinery. Revenue has not placed anything contrary on record suggesting that such expenditure was made for bringing into existence of a new asset on for the enduring benefit to the existing asset. Hence allowable as revenue expenditure - Decided against Revenue Addition U/s 40(a)(ia) on account of commission paid to foreign agents in foreign currency without deduction of tax at source - assessee did not deducted tax at source in compliance with Board Circular No.786 - Held that:- It is not disputed that in respect of AY 2005-06 the claim of the assessee was accepted by the Revenue and there is no change in the circumstance except the contention that the Circular No.786 dated 7.2.2000 has been withdrawn vide Circular No.7 of 2009. Since the claim of the assessee was based upon the circular existing at the time of assessment year, no infirmity found in order of CIT(A) deleting the addition - Decided against Revenue Dis-allowance of excess payment of interest u/s 40A(2)(b) - rate of interest work out to be 21% whereas assessee claims to have paid 12% - Held that:- Matter restored back to the file of AO to verify the claim of the assessee that the liability to pay interest crystallized in the A.Y. 2005-06 and also working out of rate of interest. Additional depreciation - Revenue submitted that the claim of additional depreciation was made in revised return and the revised return submitted when the limitation of filing of such return was expired whereas assessee submitted that CIT(A) has allowed additional depreciation having called for remand report of the AO - Held that:- It is evident from the finding of CIT(A) that for the additional depreciation has been allowed after receiving remand report. No infirmity found in order passed by CIT(A) Dis-allowance of various administrative expenditures - Held that:- It is found that order of CIT(A) is cryptic and no reasoning is given as to why the disallowances are confirmed. Therefore all the issues are restored back to the file of CIT(A) to decide these issues afresh. Expenses incurred on purchase of gift articles and contribution to one Samiti - dis-allowance - Held that:- Expenditure incurred on the occasion of diwali towards purchase of gift vouchers is allowable since the same is incurred to encourage of working ability to its workers. Further, contribution was paid to said Samiti on humanitarian ground hence allowable - Decided against Revenue Dis-allowance of advance written off claimed u/s. 37(1) - business expediency for giving the advance - Held that:- Nothing is brought on record to establish business expendiency or giving the advance in question. Thus, it is not a business advance. Hence, the same is neither allowable u/s. 37 nor u/s. 28/29 as business loss - Decided against assessee.
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