TMI Blog2014 (2) TMI 797X X X X Extracts X X X X X X X X Extracts X X X X ..... ry to lead any evidence to show that the instrument in question cannot be brought within entry 3B or 3C of the schedule – thus, the order of the Tribunal upheld – Decided against Revenue. Valuation of Closing stock – Deduction u/s 43B of the Act - Whether the Tribunal was justified in law in holding that valuation of closing stock is to be made ignoring the amount of cess paid when the same was debited, and the net effect will be nil on deduction of the same has to be allowed from the income of next year – Held that:- The decision in Berger Paints India Ltd. Versus Commissioner of Income-Tax [2004 (2) TMI 4 - SUPREME Court] and Lakhanpal National Limited Versus Income-Tax Officer [1986 (3) TMI 42 - GUJARAT High Court] followed - The enti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the Revenue has come up in appeal which was admitted by an order dated 4th April, 2003. Three several questions of law were formulated. The first question reads as follows :- (1) Whether on the facts and circumstances of the case the Income Tax Appellate Tribunal was justified in law in holding that Vibro Bed Drier is an item covered Under Appendix-1/H-III/(3)(III) of the Income Tax Rule 1962 and is entitled for 100% depreciation ? Mr. Bhowmick, learned Advocate appearing for the revenue, drew our attention to the schedule appearing in appendix to the Income Tax Rule 1962 and wanted to impress upon us that Vibro Bed Drier is not an energy saving device as per the aforesaid schedule and therefore 100% depreciation could not have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the opinion of the experts which has to be accepted in the absence of any findings to the contrary by the A.O. From the aforesaid views of the Tribunal it appears that energy efficient instrument was considered to fall within the relevant entry of this schedule and therefore 100% depreciation was allowed. The question is a mixed question of fact and law. The department at the appropriate stage did not try to lead any evidence to show that the instrument in question cannot be brought within entry 3B or 3C of the schedule. We are as such unable to find any fault with the views expressed by the Tribunal. Accordingly, the first question is answered in the affirmative and in favour of the assessee. The second question formulated in this c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t could not be permitted to take a contrary stand. The views of the Gujrat High Court were considered by the Special Bench of the Income Tax Appellate Tribunal and the following observations were made by them :- We would like to make it absolutely clear that the removal of the amount in question from the figure of closing stock is not tantamount to a tinkering of the closing stock but allowing to the assessee the effective deduction to which it is entitled under Section 43B. We would also like to emphasise that in the subsequent assessment year, the assessee s opening stock would stand reduced by a corresponding figure since it cannot avail of a double deduction . We have considered the rival submissions advanced by the learned Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year to obtain the deduction. We are as such of the opinion that the question has to be answered in the affirmative and in favour of the assessee. The third question formulated in this case reads as follows :- (3) Whether on the facts and circumstances of the case the Income Tax Appellate Tribunal was justified in law in holding that the export turnover should be the total of the amount brought to India and the amount paid as brokerage/commission outside India ignoring the fact that the amount paid as brokerage/commssion was not made by appropriate remittances from India ? Mr. Bhowmick, learned Advocate appearing for the revenue appellant, drew our attention to explanation (b) to Section 80 HHC which reads as follows :- (b) expo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... received by him was treated to be the money received or brought inside the country for the purpose of Section 80U. It was held that it was not necessary that the entire money has to be remitted to the foreign insurers and thereafter the balance has to be brought inside the country for the purpose of obtaining benefit because that would be an idle formality. This judgement has no manner of application to the facts and circumstances of this case. The other judgement cited by him is in the case of Commissioner of Income Tax vs- Bannariamman Exports Ltd. In that case, the assessee exported molasses worth Rs.6,14,87,164/- but the foreign buyer paid the amount after deducting the amount of demurrage and dead freight. It was held by the Madras H ..... X X X X Extracts X X X X X X X X Extracts X X X X
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