TaxTMI 
TaxTMI 
1998 (1) TMI 107
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....ting to orders passed under s. 263 for asst. yrs. 1987-88 and 1988-89 in ITA Nos. 1378/Del/92 & 988/Del/93, the facts in brief are that the assessments for the aforesaid two assessment years were finalised originally by the respective AOs. Subsequently, vide show-cause notice dt. 19th March, 1992, for asst. yr. 1987-88 and 5th March, 1993 for asst. yr. 1988-89, the respective CITs proposed to set aside the assessments on the ground that while arriving at the valuation of stocks certain expenses on salaries, employees welfare, rates and taxes, rent, insurance, depreciation and building and machinery repairs were not taken into account. Before the CIT, the assessee submitted that it has two factories, one at Khatua and another at Bhawani Mand....
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.... also taken into consideration salary pertaining to non-technical staff and other factors. It was however admitted that while doing so, certain expenses which are directly relatable to the cost were not taken into consideration. To cut short the matter, it was conceded that in the circumstances, while there could be dispute in regard to the inclusion of individual items of expenses, it could be fairly said that the CIT has rightly assumed jurisdiction under s. 263 of the Act. In view of the arguments of the learned authorised representative the learned Departmental Representative did not deem it fit to advance any arguments. 4. We have carefully considered the submissions as made in the light of the facts as noted above. Undoubtedly, met....
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.... it was shown that in regard to the wages and salaries of technical staff, in addition to what assessee accounted for at Rs. 4,74,60,920, the AO added an amount of Rs. 81,89,123 for asst. yr. 1987-88. In regard to asst. yr. 1988-89, the assessee accounted for wages and salaries of technical staff at Rs. 5,19,09,724. However, while doing so, the provision for bonus, fringe benefits, namely, gratuity, superannuation, leave with wages, etc. were not considered by the assessee. The AO made an addition at Rs. 22,61,788 without specifying amount. As regards packing material consumption and water expenses, as the same had been accounted for, which was not disputed in the orders passed under s. 263 of the Act, nothing is to be added on the account.....
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....t to be as under: (a) Direct material cost: (i) Raw material consumed; and (ii) Stores, spares and oil consumed (b) Direct labour cost: Salary, wages, bonus, ex gratia, etc. to staff and workers. (c) Production overheads: (i) Power and fuel consumed; (ii) Repairs and maintenance to plant and machinery; and (iii) Repairs and maintenance to factory building. Following items had not been included: (i) Administrative overheads and interest; (ii) Selling and distribution overheads; and (iii) Depreciation. As regards Direct material cost, there is no dispute in as much as, as per the chart given to us, which is not disputed by the learned Departmental Representative. The assessee has accounted for cost of....