2015 (11) TMI 1830

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....aw, the learned C.I.T. (A) erred in partly dismissing the appeal. 2. On the facts and in the circumstances of the case and in law, the learned C.I.T. (A) erred in partly dismissing the appeal without appreciating fully and properly the facts of the case. 3. On the facts and in the circumstances of the case and in law, the learned C.I.T. erred in upholding partly disallowance of expenses pertaining to prior periods amounting to Rs. 6,18,324/- 2. The assessee was engaged in the business of production of Winding Wire and Enameled Wire. During the year the assessee filed its return of income at Rs. 23,165/- through e-filing. 3. The case of the assessee was selected for scrutiny and the ld. Assessing Officer (A.O.) assessed income at....

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....e assessee. 5. The ld. Counsel also pointed out that the assessee is required to incur many expenses which were liable for service tax and which are not directly connected to the manufacturer activity and therefore not allowed to be set off against the central excise duty and, thus, the same was written off during the previous year under consideration. In other words the as per the CENVAT input credit rules lays down as to when the credit of service tax can be availed and also the where the set off is not available . The ld counsel further submitted that service tax credit is only allowed when the expenses were incurred which are directly connected to manufacturing and not otherwise. As against the short insurance claim of Rs. 4,13,147/-....

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.... of was available was rightly written off and the order of the ld. CIT (A) cannot be sustained on this point. So far as the disallowance of Rs. 4,13,147/- is concerned, again we are of the view that the assessee has rightly written off the un-receivable insurance claim during the year which were either rejected or short accepted by the insurance company. More so when these expenses are not related to the prior period as the circumstances and facts under which these amounts were written off came to be finalized during the year. The ld. Counsel of the assessee further pointed out that the similar expenditure were allowed by the Department in the earlier years. All these write offs are necessitated when their adjustments or recovery is not pos....