TaxTMI 
TaxTMI 
TaxTMI 
2017 (5) TMI 472
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....or the Assessment Year (AY) 2010-11. 2. The grounds of appeal raised by the Revenue read as under:- 1. "The CIT(A) has erred in law and on facts by considering the Capital expenditure of Rs. 21.63 lacs for renovation of factory building as revenue expenditure3. As per provisions of section 30(a)(ii), only expenses for current repairs are allowable as deduction. While deciding the issue, CIT(A) has overlooked the fact that the expenses incurred have given benefit of enduring nature to the assessee. 2. The CIT(A) has erred in law and on facts in deleting the addition of Rs. 15.17 lacs towards unutilized Cenvat Credit despite the fact that the assessee followed exclusive method of valuing inventory in contravention of section 145A which ma....
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.... of the factory building involving re-plastering, re-flooring, re-placement of doors, re-plumbing, which cannot be characterized as current repairs. The Ld.DR also referred to the bills and submitted that some expenditure have been incurred towards basic restructuring of building including replacement of RCC columns. The Ld.DR accordingly submitted that the expenditure incurred are bringing endurance value to the premises and are in the nature of capital expenditure on which the assessee is entitled to depreciation as already allowed. 4.2. The Ld.AR, on the other hand, referred to the details of repairs to the building of different phase and submitted that the factory building is in the chemical zone which is subject to relatively more dam....
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....made by the assessee while incurring such expenditure. A repair ordinarily involves renewal and restoration of the existing wear and tear. Such expenditure, in our view, is in the nature of current repair in spite of major expenses alleged to have been incurred. Thus, we find no merit in the plea of the revenue on this score. 4.4. Ground No.1 of Revenue's appeal is accordingly dismissed. 5. Ground No.2 of Revenue's appeal concerns alleged contravention of section 145A while valuing the closing stock for determination of taxable income of the assessee. The AO found that unutilized CENVAT credit of Rs. 15,17,765/- has not been included in the valuation of closing stock of raw-material and thereby the taxable income of the assesseecompany is....
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....ct to section 145A, both the opening stock and closing stock are required to be simultaneously brought in parity as a matter of legitimate expectation. We also take note of the decision of the Coordinate Bench of the Tribunal in the case of Dy.CIT vs. Balvant Lallubhai Rotliwala in ITA No.1885/Ahd/2011 dated 01/02/2016 relied upon by the assessee where on similar facts, addition made under s.145A was deleted by the ITAT. The guidance note issued by the ICAI also supports the case of the assessee for the proposition that there is no impact on ultimate profit by resorting to exclusive method of accounting for the purpose of valuation of stock as adopted by the Assessee. The Revenue has not brought on record anything contrary to the assertions....
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....cceptance for the similar reason. The loss is required to be proved to be emanating from business of the assessee. Secondly, the loss is required to be proved to have been crystallized during the year. No material or evidence has been brought on record to this effect. Thus, ground No.1 of the Cross Objection of the assessee is devoid of merit. 7.2. Ground No.1 of the Cross Objection is dismissed. 8. Ground No.2 of the Cross Objection concerns disallowance of Rs. 43,835/- under s.14A of the Act. The Ld.AR for the assessee pointed out that the assessee has earned a meager dividend income of Rs. 8,212/- which is exempt from tax. He relied upon the decision of the Hon'ble High Court of Delhi in the case of Joint Investments Pvt.Ltd. vs. CIT r....