TMI Blog2013 (1) TMI 968X X X X Extracts X X X X X X X X Extracts X X X X ..... he regular books of accounts fully satisfying the conditions as laid down in s 37. Also, assessee has already surrendered its license under the Excise Act and opted for the exemption route and hence, there is no question of setting off the said expenditure in future. Thus, claim is allowed. Decision in the cases of GIRDHAR FIBRES PVT. LTD. VERSUS ASSISTANT COMISSIONER OF INCOME TAX RANGE-1 SURAT [ 2012 (11) TMI 161 - ITAT, AHMEDABAD] and MOHAN SPG. MILLS VERSUS ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-I, LUDHIANA [ 2013 (11) TMI 113 - ITAT CHANDIGARH] , relied upon. - I.T.A. No.1936/Ahd/2010 - - - Dated:- 11-1-2013 - SHRI MUKUL Kr.SHRAWAT, JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER For the Appellant : Shri T.Sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e by observing as under:- 1. have considered the findings of the AO and the submissions made by the appellant. From the facts of the case, it is evident that the appellant has opted for the exemption route without availing Cenvat Credit and therefore, unutilized Cenvat Credit of ₹ 60,24,121/- as availed on the inputs, was written off in the regular books of accounts by the assessee which is evident from RG-23A Part-II register as produced before the AO. The fact that the CENVAT Credit is pertaining to the inputs and that the purchase cost of the input has been debited net of CENVAT credit in the P L account is not under dispute at all. Accordingly, I am inclined to agree with the assessee that the Cenvat Credit attributable to inp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he following cases:- (i) decision of ITAT Bench B Chandigarh in the case of M/s.Mohan Spinning Mills vs. ACIT (ITA No.1212/Chd/2011 A.Y. 2006-07 order dtd.25.4.12) (ii) decision of ITAT Bench A Ahmedabad in the case of Girdhar Fibres Pvt.Ltd. vs. ACIT (In ITA No.2027/Ahd/2009 A.Y. 2006-07 order dtd.12.10.12) 4. Having heard the submissions of both the sides and considering the facts of the case as narrated before the lower authorities, it was observed that the aforesaid amount of the Excise Duty was written off at the time of surrender of Excise Registration Certificate. On this issue, the Respected Coordinate Bench Chandigarh in the case of M/s.Mohan Spinning Mills (supra) has opined as under:- 7. We have heard the riv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excise duty applicable on the manufactured items, consequently credit of excise duty was available with the assessee. The said excise duty paid from year to year was not claimed as an expenditure but was carried forward from year to year to be adjusted against the excise duty payable by the assessee on its manufactured items. However, during the year under consideration the assessee closed down its manufacturing unit and consequently the benefit of the CENVAT credit remained unadjusted. Once the manufacturing unit of the assessee is closed down, admittedly the benefit of CENVAT credit not availed of against the excise duty payable on manufactured items, cannot be utilized by the assessee and the said write off of CENVAT credit, is allowabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f accounts. We find force in this argument of the assessee because while maintaining the exclusive method of accounting the assessee had a choice to increase the value of the purchases in respect of the duty paid in the form of AED NCCD. In other words, an expenditure was incurred but that expenditure could not be adjusted against the CENVAT Rules because on the finished goods, i.e. texturised yarn only the basic duty is leviable. We, therefore, hold that the amount which is now written off being part of the business expenditure, hence allowable under the provisions of the Act. In the result, we hereby reverse the findings of the authorities below and allow the ground raised by the Assessee. 5. In the light of the above decisions, onc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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