TaxTMI 
TaxTMI 
2012 (10) TMI 127
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..../-. During the course of assessment proceedings, it was noticed by the AO that the assessee has followed the inclusive method as a result of which unutilized Modvat credit was not included in the value of closing stock. Since the said method of valuation of closing stock followed by the assessee was not in accordance with the provisions of sec.145A, the AO added the unutilized Modvat credit of Rs. 21,10,564/- to the value of closing stock declared by the assessee. The Ld. CIT (A) confirmed the said addition made by the AO on this issue following the decision of his predecessor in assessee's own case for the earlier year and directed the AO to verify the claim of the assessee regarding the exact quantum of addition. 4. We have heard the arguments of both the sides and also perused the relevant material on record. It is observed that a similar issue had come up for consideration before the co-ordinate Bench of this Tribunal in assessee's own case for AY 2001-02 and vide its order dated 7th February, 2008 passed in ITA 6854/M/2002, the same was restored by the Tribunal to the file of the AO with a direction to decide the same afresh after verifying the recast accounts to be ....
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....of net interest or net rent which is included in the profits to be excluded for the purpose of computing the deduction u/s.80HHC and not of gross interest or gross rent. Accordingly we direct the AO to recompute the deduction u/s.80HHC after verifying the assessee's alternative claim in relation to the net income from the relevant record. Ground no.2.3 to 2.6 of the assessee's appeal are accordingly treated as partly allowed for the statistical purpose. 6. The issue raised in ground no.2.7 & 2.8 of the assessee's appeal relates to its claim for deduction u/s.80HHC in respect of foreign exchange gain. 7. We have heard the arguments of both the sides also perused the relevant material on record. As submitted by the Ld. Counsel for the assessee, the impugned foreign exchange earned in the year under consideration was in respect of export proceeds realized and even the Ld. CIT (A) on page no.6 of his impugned order has given a finding that the foreign exchange gain is related to the export business of the assessee. In assessee's own case for AY 2002-03, the Hon'ble Bombay High Court has held that what is liable to be excluded from the profits of business for the purpose of comput....
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.... relevant bills placed at page no.75 to 86 of his paper book and submitted that same are sufficient to show that the expenses incurred by the assessee on repairs and maintenance are revenue in nature. He also took us through the written submission made by the assessee before the Ld. CIT (A) (relevant portion at page no.46 of the paper book) and relied on the same in support of the case on this issue. 11. After perusing the copies of bills filed in the paper book of the assessee as well as written submissions filed by the assessee before the Ld. CIT (A), we find that the same are not sufficient to support and substantiate the case of the assessee that the impugned repairs and maintenance expenses are of revenue in nature. It is not clear from the documents filed by the assessee as to whether the expenditure in question incurred by the assessee on repairs and maintenance is of revenue nature inasmuch as it is very difficult to come to a conclusion on the basis of the said documents that the expenses incurred by the assessee on repairs and maintenance were on purchase of spare parts of plant and machinery and miscellaneous work done to the building and there was no new capital asse....
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....e co-ordinate Bench of this Tribunal in assessee's own case for AY 2006-07 rendered vide its order dated 7th September, 2011 passed in ITA No.8753/Mum/2010 wherein a similar issue was decided in favour of the assessee by the Tribunal vide paragraph No.11 as under: "11. The next adjustment of Rs. 4,70,000, on the ground that the assessee ought not to have allowed discount of 10% to AEs, is also equally devoid of any merits. We have noted that the assessee has followed the TNMM for determination of ALP and the Assessing Officer has not even disputed TNMM being most appropriate method on the facts of this case. The question of applying CUP, even if that be so, can only arise when TNMM is rejected. Even under CUP method, it is not necessary that all sales must take at the same price. There can always be variations of prices for the same product or services on valid grounds, such as quantum of business, risk factors, marketing efforts needed etc. When assessee is dealing with an AE, at least there are no commercial risks, no marketing costs and there could be several other factors as well justifying a normal discount as the assessee could indeed go to many important customers. It har....