9911796707
TMI Blog2021 (11) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... e not given to the assessee and, in this year, he has written off the alleged customs duty receivable in the accounts and claimed it as revenue expenditure in the profit and loss account. We find that the learned First Appellate Authority has rightly adjudicated this issue after putting reliance upon the decision of the ITAT in the case of ACIT Vs. Rangoli Industries Pvt. Limited [ 2013 (1) TMI 968 - ITAT AHMEDABAD] and no interference is called for. - ITA No. 1694/Ahd/2019 & CO No. 16/Ahd/2020 - - - Dated:- 4-10-2021 - Rajpal Yadav , Vice President And Pradip Kumar Kedia , Member ( A ) For the Appellant : S. S. Shukla , Sr. DR ORDER Per Rajpal Yadav , Vice President The Revenue is in appeal before the Tribunal against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eceived hence expenses were claimed as revenue expenditure in year under consideration. The AO has stated that as per provisions of Section 43B of the Act, any duty, taxes, cess or fees by whatever name called, shall be allowed only in previous year in which such sum is actually paid and custom duty is paid in earlier year hence cannot be allowed as expenditure under Section 43B of the Act. Accordingly, he made disallowance of ₹ 3,22,561. 3.4. The appellant has claimed that it has paid custom duty in earlier assessment year and same was not claimed as revenue expenditure but shown as custom duty receivable as it was entitled to receive refund of such custom duty benefits from the Government. As such benefits were not received, ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pvt. Limited in ITA No. 1936/Ahd/2010 vide order dated 11th January, 2013 has held as under: Facts in brief as emerged from the corresponding assessment order passed u/s. 143(3) r.w.s. 147 dated 22.12.2009 were that the assessee-company is following the Mercantile system of accounting. It was noted by the Assessing Officer that for the year under consideration an amount of ₹ 65,24,121/- was written off by debiting the profit loss account pertaining to Excise Duty. According to him, Government had declared the scheme wherein the assessee has been given an option to continue with the present rate of Excise Duty or to avail a route of exemption. After going through the submissions of the assessee, the Assessing Officer was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise duty resulting in accumulation of CENVAT. 10. Various tests have been laid down by various High Courts and the Apex Court in relation to the allowability of expenditure under section 37(1) of the Act while computing the income from profits and gains of business or profession. In the facts of the present case, the assessee had paid CENVAT on purchase of raw material which was deposited in its PLA account for claiming the benefit of set off against the excise duty payable on the manufactured items i.e. branded yearn. The assessee was paying higher rate of excise duty on the raw material purchased by it as against the rate of excise duty applicable on the manufactured items, consequently credit of excise duty was available with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that the impugned two amounts were part of the duty which was paid by the assessee at the time of purchase of raw-material, however, the assessee had maintained exclusive system of accounting, therefore the duty paid was not debited as a part of the purchases but a separate account was maintained and carried to the balance-sheet. The AED and NCCD were applicable on POY, i.e. raw-material. When the finished goods, i.e. texturized yarn is manufactured, the excise is levied in the form of basic duty. The assessee has adopted exclusive method of accounting, therefore debited the net purchases and those were separately recorded in the books of accounts. We find force in this argument of the assessee because while maintaining the exclusive meth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year, he has written off the alleged customs duty receivable in the accounts and claimed it as revenue expenditure in the profit and loss account. We find that the learned First Appellate Authority has rightly adjudicated this issue after putting reliance upon the decision of the ITAT in the case of ACIT Vs. Rangoli Industries Pvt. Limited (Supra) and no interference is called for. 6. So far as the Cross-Objection is concerned, the assessee has raised two grounds of appeal. In Ground No. 1, it has challenged the reopening of the assessment and Ground No. 2 is a general ground of appeal which does not call for recording of any finding. 7. We have dismissed the appeal of the Revenue on merit. No one has come present on behalf of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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