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2017 (12) TMI 1665 - AT - Income TaxReopening of assessment - addition of unutilized CENVAT credit - as held by by the AO that it cannot be treated as advance given to the Government on account of excise payable - addition of excise duty in closing stock value since the assessee runs its cars on hire - HELD THAT:- There is no dispute that the assessee had paid the impugned excise duty on motor cars purchased for its hiring business. It reduced the relevant excise duty on the said purchases from the total cost of the motor cars. This followed its depreciation claim on the consequential reduced cost thereof. The assessee thereafter treated the above excise duty amount as an advance in its balance sheet’s asset side. Revenue is fair enough in not disputing the fact that it is already entitled to claim 50% of the above excise duty as CENVAT credit. The assessee has admittedly set off its service tax payable to the extent of 50% of the above excise duty. It thereafter has carried forward the remaining amount in the next year - there is no income element embedded therein since the assessee is not entitled to get the same refunded from the government since the same has to be utilized only against the service tax payable. We therefore express our agreement with learned CIT(A)’s conclusion that the above excise duty cannot be added in closing stock value since the assessee runs its cars on hire. - Decided against revenue
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