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2016 (7) TMI 962 - GUJARAT HIGH COURT

2016 (7) TMI 962 - GUJARAT HIGH COURT - TMI - Addition in the value of closing stock towards excise duty - Held that:- This issue raised in this appeal is identical to one which has been decided by this Court in case of Assistant Commissioner of Incometax V. Narmada Chematur Petrochemicals Ltd. [2010 (8) TMI 263 - Gujarat High Court ] wherein held that the Tribunal was justified in law in excluding the excise duty at the time of valuation of the closing stock of finished goods at the end of the .....

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peal, following question of law was framed for consideration: Whether on the facts and in the circumstances of the case, the Tribunal was right in law in confirming the order of the CIT (A) whereby he deleted the addition of ₹ 8,67,671/in the value of closing stock towards excise duty? 3. Learned Counsel for the assessee has submitted that issue raised in this appeal is identical to one which has been decided by this Court in case of Assistant Commissioner of Incometax V. Narmada Chematur .....

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the contrary. As held by the Apex Court in the case of Tuticorin Alkali Chemicals and Fertilizers Ltd. vs. Commissioner of Income-Tax (1997) 227 ITR 172 It is true that this court has very often referred to accounting practice for ascertainment of profit made by a company or value of the assets of a company. But when the question is whether a receipt of money is taxable or not or whether certain deductions from that receipt are permissible in law or not, the question has to be decided according .....

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o.2) Act, 1998 with effect from 1.4.1999. The Assessment Year being 1997-98 the said provision cannot be invoked. However even otherwise one may consider the Notes On Clauses and the Memorandum Explaining Provisions In Finance (No.2) Bill, 1998 which read as under (relevant extract): NOTES ON CLAUSES: Clause 45 seeks to insert a new section 145A in the Income-tax Act relating to method of computation of opening and closing stock. It is proposed that while computing the value of the inventory as .....

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sment year 1986-87 and subsequent years. MEMORANDUM EXPLAINING PROVISIONS: Computation of value of inventory The issue relating to whether the value of closing stock of the inputs, work-in-progress and finished goods must necessarily include the element for which MODVAT credit is available has been the matter of considerable litigation. In order to ensure that the value of opening and closing stock reflect the correct value, it is proposed to insert a new section to clarify that while computing .....

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