2020 (10) TMI 879

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....ct, 1961 (here-in-after referred to as "the Act") relevant to the Assessment Year 2006- 2007. 2. The only issue raised by the Revenue is that the ''Ld.CIT (A)'' erred by deleting the addition made by the AO for Rs. 3,80,07,933/- for the adjustment made in the section 145A of the Act. 3. The fact in fact brief are that the assessee in the present case is a private limited company and engaged in the business of ship breaking. The AO during the Assessment Proceedings found that the assessee has shown unutilized CENVAT credit amounting to Rs. 3,80,07,933/- in its balance sheet as on 31/03/2006. As per the AO the amount of unutilized CENVAT credit was to be included in the value of closing stock in pursuance to the provisio....

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....ehemently supported the order of the authorities below as favorable to them. 6. We have heard the rival contentions of both the parties and perused the materials available on record. The provisions of section 145A of the Act mandate to follow the exclusive method of accounting which requires to record the transaction of purchase, sales of the stock after including taxes incurred in relation to purchase/sales of goods. But in the case on hand we find that the assessee has not included such taxes in the amount of purchases, sales and closing stock. However, we note that if such taxes are included in the opening stock, purchase, sales and closing stock then there will not be any difference in the total income declared by the assessee. It is....

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.... ITA No.1442/Ahd/2012 vide order dated 10/06/2016, in identical facts and circumstances has decided the issue in favor of the assessee by observing as under:  "3. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below. The issue in the present case is with respect to inclusion of unutilized CENVAT credit to the closing stock. We find that Id.CIT(A) while deleting the addition has given a finding that the assessee was following exclusive method of accounting and the CENVAT was not debited or credited to the Profit & Loss account and the aforesaid method has been consistently followed by the assessee in earlier and succeeding years. We further find that ....