2011 (1) TMI 323

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....was right in holding that the assessee was entitled to exclude excise and customs duties paid from the value of the closing stock ?   3. Whether the assessee is entitled to claim deduction of Rs.14,71,387 on account of excise duty paid in advance as business expenditure ?"   2. Learned counsel for the respondent/assessee concedes that in so far as the first question is concerned, since in the subsequent assessment years, the addition made by the Department has been accepted by the assessee. Question No. 1 be answered in favour of the Department. It is ordered accordingly.   3. As regards question No. 2, Ms. Bansal affirms that it has to be answered in favour of the assessee in view of the judgment in Berger Paints....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....n the statute which permitted deduction on an accrual basis without the requisite obligation to deposit the tax with the State. Resultantly, on the basis of mere book entries the assessee would claim deduction without actually paying the tax to the State.   6. In the factual matrix of the present case, the controversy arises in respect of the excise duty payable by the assessee on the goods manufactured in the factory. The incidence for imposition of excise duty, that is, the liability arises on manufacture of goods. A self-assessment procedure was provided under rule 173G of the Central Excise Rules. The relevant portion of rule 173G of the Central Excise Rules reads as follows :   "173G. Procedure to be followed by the ass....