The ACIT, Circle-1(1)(1), Baroda V. M/s. Gujarat Alkalies and Chemicals Ltd., Baroda

ITA 1425/AHD/2018

• Counselvise Citation: [2019] 111 COUNSELVISE.COM (IT) 9793 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 29-11-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 31-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUBHASH BEINS
• Assessee Lawyers: SULABH PADSHA
• Keywords: Depreciation; Revenue expenditure; Capital expenditure
• Section: 201; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH BEFORE: SHR I MAHAVIR PRASAD , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER THE ACIT, CIRCLE - 1(1)(1), VADODARA - 390007 (APPELLANT) VS M/S. GUJARAT ALKALIES & CHEMICALS LTD., P.O. PETROCHEMICALS, AT RANOLI, VADODARA - 391346 PAN: AAACG8896M (RESPONDENT) REVENUE BY : S H RI SUBHASH BEINS , CIT - D . R. ASSESSEE BY: SHRI SULABH PADSHA , A.R. DATE OF HEARING : 03 - 12 - 2 019 DATE OF PRONOUNCEMENT : 19 - 12 - 2 019 / ORDER P ER : AMARJIT SINGH, ACCOUNTA NT MEMBER : - THIS REVENUE S APPEAL FOR A.Y. 2013 - 14 , ARI SES FROM ORDER OF THE CIT(A) - 1, VADODARA DATED 26 - 03 - 2 018 , IN PROCEEDINGS UNDER SECTION 1 4 3 R.W.S. 92CA OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL: - I T A NO . 1425 / A HD/20 18 A SS ESSMENT YEAR 2013 - 14 I.T.A NO. 1425 /AHD/20 18 A.Y. 2013 - 14 PAGE NO ACIT VS . M/S. GUJARAT ALKALIES & CHEMICALS 2 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE AMORTIZATION OF LEASE RENT AMOUNTING TO RS. 3.99 LACS, WHICH IN FACT, THE EXPENDITURE IS TO TREATED AS CAPITAL IN NATURE AND NOT AS REVENUE IN NATURE AS HELD BY THE LD. C1T(A)'. 2. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE ADDITION OF RS. 18,23,40,120/ - MADE ON C ACCOUNT OF DISALLOWANCE OF EXPENDITURE FOR REPLACEMENT OF RE - MEMBRANING CELLS DISREGARDING THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS SARAVANA SPINNING MILLS PVT. LTD. (2007) 293 1TR 201 (SC).' 3. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (APPEALS) ERRED IN DELETING THE ADD ITION/DISALLOWANCE OF RS. 13.86 LACS MADE IN 'BOOK PROFIT' ON ACCOUNT OF PRIOR PERIOD EXPENSES COMPLETELY DISREGARDING WITH THE DECISION OF THE HON'BLE HIGH COURT OF KERALA IN THE CASE OF SHREE BHAGAWATHY TEXTILES LTD VS. ASSISTANT COMMISSIONER OF INCOME - T AX[2011] 199 TAXMAN 14 (KER.).' 4. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. C1T(A) ERRED IN DELETING THE UNUTULIZED MODVAT CREDIT IN RAW MATERIAL AMOUNTING TO RS. 8,02,40,605/ - . THE AO WAS JUSTIFIED IN ADDING BACK THE UNUTILIZ ED MODVAT CREDIT FOR THE YEAR AS PER THE NEW PROVISIONS OF SECTION 145A OF THE IT ACT, WHEREIN THE THE UNUTILIZED MODVAT CREDIT HAD TO BE INCLUDED IN THE CLOSING STOCK OF RAW MATERIAL AND WORK IN PROGRESS, WHEREAS THE EXCISE DUTY PAID ON UNSOLD FINISHED GO ODS HAD TO BE INCLUDED IN THE INVENTORY OF FINISHED GOODS.' 3. IN THIS CASE, THE RETURN OF INCOME DECLARING INCOME OF RS. 2 , 92 , 80 , 15 , 570/ - WAS FILED ON 20 TH SEP, 2013. THE CASE WAS SUBJECT TO SCRUTINY ASSESSMENT AND NOTICE U/S. 143(2) OF THE ACT WAS ISSUED ON 3 RD SEP, 2014. THE ASSESSEE COMPANY WAS ENGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF CHEMICALS AND GENERA TION OF POWER. THE ASSESSMENT U/S. 143(2) R.W.S. 92CA OF THE ACT WAS FINALIZED ON 29 TH DECEMBER, 2016 AND TOTAL INCOME WAS DETE RMINED AT RS. 3 , 19 , 14 , 09 , 106/ - . THE ASSESSING OFFICER HAD M ADE VARIOUS ADDITIONS AGAINST WHICH THE ASSESSEE HAD PREFERRED APPEAL BEFORE THE LD. CIT(A) LD. CIT(A). THE LD. CIT(A) HAS DELETED THE ADDITION AND DISAL LOWANCE . THE RELEVANT FACTS PERTAINING TO SUCH ADDITIONS ARE DISCUSSED WHILE ADJUDICATING THE GROUND S OF APPEAL OF THE REVENUE AS FOLLOWS: - GROUND NO. 1 (DELETING THE AMORTIZATION OF LEASE RENT AMOUNTING TO RS. 3.99 LACS.) I.T.A NO. 1425 /AHD/20 18 A.Y. 2013 - 14 PAGE NO ACIT VS . M/S. GUJARAT ALKALIES & CHEMICALS 3 4. THE ASSESSING OFFICER HAS DISALLOWED AN AMOUNT OF R S. 3.99 LACS IN RESPECT OF AMORTIZATION OF LEASE RENT. THE LD. CIT(A) HAS ALLOWED THE APPEAL OF THE ASSESSEE HOLDING THAT HON BLE GUJARAT HIGH COURT HAS DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSEE VIDE IT NO. 578 OF 2016 3 RD OCT, 2016 . 5. DURING THE COURSE OF APPEL LATE PROCEEDINGS BEFORE US, THE LD. COUNSEL HAS BROUGHT TO OUR NOTICE THAT SIMILAR ISSUE ON IDENTICAL FACT HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY ITAT AHMEDABAD VIDE ITA NO. 1589/AHD / 2016 IN ASSESSMENT YEAR 2012 - 13. THE LD. DEPARTMENTAL REPRESENTAT IVE IS FAIR ENOUGH NOT TO CONTRADICT THESE UNDISPUTED FACT S . WE HAVE PERU S ED THE ABOVE CITED DECISION OF ITAT AHMEDABAD AND FIND THAT THE SIMILAR ISSUE ON IDENTICAL FACTS HAS BEEN DECID ED IN FAVOUR OF THE ASSESSEE A FTER FOLLOWING THE DECISION OF J URISDIC TIONAL HIGH COURT . RELEVANT PART OF THE DECISION IS AS UNDER: - 24. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. AT THE OUTSET WE NOTE THAT THE IMPUGNED ISSUE HAS ALREADY BEEN DECIDED BY THE JURISD ICTIONAL HIGH COURT IN FAVOUR OF THE ASSESSEE IN TAX APPEAL NO. 578 OF 2016 WIDE ORDER DATED 3 OCTOBER 2016. THE RELEVANT EXTRACT IS REPRODUCED AS UNDER: 2. SINCE THE ISSUE IS COVERED BY THE DECISION OF THIS COURT, WE HAD ISSUED NOTICE FOR FINAL DISPOSAL . LEARNED ADVOCATE FOR THE PARTIES DO NOT DISPUTE THAT BY JUDGEMENT DATED 21.10.2013 IS TAX APPEAL NO.778/2013 AND CONNECTED APPEALS, THIS COURT IN CASE OF THIS VERY ASSESSEE CONSIDERED THIS ISSUE AS UNDER: 9.0 NOW, SO FAR AS QUESTION NO 2 IN TAX APPEAL NOS.778 OF 2013 AND 779 OF 2013 AND SOLE QUESTION IN TAX APPEAL NO.780 OF 2013I.E. WHETHER THE LEARNED TRIBUNAL WAS RIGHT IN LAW IN HOLDING THAT RS, 3,36.224/ - BEING AMORTISATION OF LEASE RENT FOR THE LAND IS CAPITAL EXPENDITURE IS CONCERNED, ON CONSIDERIN G THE DECISION OF THIS COURT IN THE CASE OF SUN PHARMACEUTICAL INDUSTRIES LIMITED (SUPRA) AS WELL AS DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF MADRAS AUTO SERVICES PVT. LIMITED (SUPRA), WE ARE OF THE OPINION THAT THE LEARNED TRIBUNAL HAS COMMITTED AN ERROR IN DISTINGUISHING THE AFORESAID DECISIONS AND NOT APPLYING THE SAME TO THE FACTS OF THE CASE ON HAND. CONSIDERING THE AFORESAID TWO DECISIONS, IT IS TO BE HELD THAT THE AFORESAID LEASE RENT WAS DEDUCTIBLE AS REVENUE EXPENDIT URE AND THE LEARNED TRIBUNAL HAS ERRED IN HOLDING THAT RS.3,36,224/ - AFTER AMORTISATION OF LEASE RENT PAID FOR THE LAND IS CAPITAL EXPENDITURE. UNDER THE CIRCUMSTANCES, CONSIDERING THE AFORESAID TWO DECISIONS OF THE HON'BLE SUPREME CONN IN THE CA SE OF MADRAS AUTO SERVICES PVT, LIMITED (SUPRA) AND THE DECISION OF THIS HON'BLE COURT IN THE CASE OF SUN PHARMACEUTICAL INDUSTRIES LIMITED (SUPRA) THE QUESTION NO. 2 IN TAX APPEAL NOS. 778 AND 779 OF 2013 AND SOLE QUESTION NO.1 IN TAX APPEAL NO. 7 80 I.T.A NO. 1425 /AHD/20 18 A.Y. 2013 - 14 PAGE NO ACIT VS . M/S. GUJARAT ALKALIES & CHEMICALS 4 OF 2013 IS REQUIRED TO BE ANSWERED IN FAVOUR OF THE ASSESSOR AND AGAINST THE REVENUE. 3. IN THE RESULT, APPEAL IS ALLOWED. QUESTION IS ANSWERED IN FAVOUR OF THE ASSESSEE. JUDGEMENT OF THE TRIBUNAL TO THAT EXTENT IS REVERSED. TAX APPEAL IS DISPOSE D OF. RESPECTFULLY, FOLLOWING THE JUDGMENT OF THE HON BLE GUJARAT HIGH COURT IN THE OWN CASE OF THE ASSESSEE (SUPRA), WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF THE LEARNED CIT - A. HENCE THE GROUND OF APPEAL OF THE REVENUE IS DISMISSED. RESPECTFULLY FOLLOWING THE DECI SI ON OF CO - ORDINATE B ENCH BASED ON JUDGMENT OF HON BLE GUJARAT HIGH COURT, WE DO NOT FIND ANY REASON TO INTERFERE IN THE DEC SSION OF LD. CIT(A). THEREFORE, THIS GROUND OF APPEAL OF THE REVENUE IS DISMISSED. GROUND NO. 2 (DELETING THE ADDITION OF R S. 18 , 23 , 40 , 120/ - ON ACCOUNT OF DISALLOWANCE OF E XPENDITURE FOR REPLACEMENT OF RE - MEMBRANING C ELLS) 6. THE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF ASSESSEE IN RESPECT OF REPLACEM ENT OF COST OF RE - MEMBRANING AS DEFER RED REVENUE EXPENDITURE AMOUNTING TO RS. 19 , 71 , 24 , 454/ - AFTER REFERRING THE SIMILAR DISALLOWANCE MADE IN ASSESSMENT YEAR 2012 - 13. HOWEVER, THE ASSESSING OFFICER HAS RESTRICTED THE DISALLOWANCE TO RS. 18 , 23 , 40 , 120/ - AFTER ALLOWING DEPRECIATION OF RS. 1 , 47 , 84 , 334/ - . THE LD. CIT(A) HAS ALLOWED THE APPEAL OF THE ASSESSEE AFTER FOLLOWING THE DECISION OF HON BLE GUJARAT HIGH COURT IN THE CASE OF THE ASSESSEE ITSELF FOR ASSESSMENT YEAR 1999 TO 2000 AND ASSESSMENT YEAR 2000 TO 2011. 7. DURING THE COURSE O F APPELLATE PROCEEDINGS BEFORE US, THE LD. CO UNS EL HAS BROUGHT TO OUR NOTICE THAT SIMILAR ISSUE HAS BEEN ADJUDICATED BY T H E ITAT IN FAVOUR OF THE ASSESSEE VIDE ITA NO. 1589/AHD/2016 IN ASSESSMENT YEAR I.T.A NO. 1425 /AHD/20 18 A.Y. 2013 - 14 PAGE NO ACIT VS . M/S. GUJARAT ALKALIES & CHEMICALS 5 2012 - 13. THE LD. DEPARTMENTAL REPRESENTATIVE IS FAIR E NOUGH NOT TO CONTRADICT THESE UNDISPUTED FACT S . WE HAVE GONE THROUGH THE ABOVE CITED DECISION OF THE ITAT AND NOTICED THAT SIMILAR ISSUE HAS BEEN ADJUDICATED IN FAVOUR OF THE ASSESSEE. THE RELEVANT PART OF THE DECISION IS AS UNDER: - 29. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. AT THE OUTSET WE NOTE THAT THE IMPUGNED ISSUE HAS ALREADY BEEN DECIDED BY THE JURISDICTIONAL HIGH COURT IN FAVOUR OF THE ASSESSEE IN TAX APPEAL NO. 577 OF 2016 VIDE ORDER DATED 1 AUGUST 2016. THE RELEVANT EXTRACT IS REPRODUCED AS UNDER: 3. THOUGH THREE DIFFERENT QUESTIONS ARE FRAMED, THE ISSUE IS SINGLE VIZ. THE CORRECTNESS OF THE DECISION OF THE ITAT IN DELETING ADDITION OF RS. 4.67 CRORES MADE ON ACCOUNT OF EXPENSES I NCURRED FOR REPLACEMENT OF REMEMBERING CELLS - II. THE REVENUE WOULD CONTEND THAT THE EXPENDITURE IS CAPITAL IN NATURE AND THEREFORE, WAS NOT ALLOWABLE DEDUCTION. 4. BOTH SIDES AGREED THAT THIS ISSUE IN CASE OF THIS VERY ASSESSEE FOR EARLIER ASSESSMENT YEAR S CAME UP FOR CONSIDERATION BEFORE THIS COURT IN CASE OF COMMISSIONER OF INCOME TAX VS. GUJARAT ALKALIES AND CHEIMCALS LTD . REPORTED IN 372 ITR 237. DIVISION BENCH OF THIS COURT DISMISSED THE REVENUE'S A PPEAL MAKING FOLLOWING OBSERVATIONS: '12. THE ATTEMPT TO CONTEND THAT LIFE OF MEMBRANE WOULD BE SPREAD OVER FROM 3 TO 5 YEARS OR THAT THE AMOUNT INVOLVED FOR REPLACEMENT OF MEMBRANE IS HUGE AND, THEREFORE, THE DEPARTURE ON THE PART OF THE REVENUE COULD BE SAID AS JUSTIFIED, IN OUR VIEW, CANNOT BE COUNTENANCE FOR TWO REASONS. ONE IS THAT THE AMOUNT INVOLVED WOULD NOT MAKE DIFFERENCE FOR CHARGABILITY OF THE TAX BUT THE NATURE OF EXPENDITURE WOULD BE RELEVANT FOR THE CHARGABILITY OF TAX. IT HARDLY MATTERS WHE THER THE AMOUNT IS MORE OR LESS. FURTHER, ON THE ASPECT OF LIFE OF THE MEMBRANE, NOTHING IS REFERRED TO BY THE A.O. NOR BY C.I.T. (APPEALS) THAT EARLIER, SUCH ASPECT, NAMELY, LIFE OF THE MEMBRANE SPREAD OVER FROM 3 TO 5 YEARS WAS NOT CONSIDERED OR IT HAD M ISSED OR OTHERWISE.' 5. IN THE RESULT, THIS TAX APPEAL IS DISMISSED. RESPECTFULLY, FOLLOWING THE JUDGMENT OF THE HON BLE GUJARAT HIGH COURT IN THE OWN CASE OF THE ASSESSEE (SUPRA), WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF THE LEARNED CIT - A. HENCE THE GROUND OF APPEAL OF THE REVENUE IS DISMISSED. RESPECTFULLY FOLLOWING THE DECISION OF CO - ORDINATE BENCH ON THE BASIS OF JUDGMENT OF HON BLE ITAT ON THE ISSUE IN APPEAL, WE DO NOT FIND ANY SUBSTANCE IN THE GROUND OF APPEAL OF THE REVE NUE, THEREFORE, THE SAME STANDS DISMISSED. I.T.A NO. 1425 /AHD/20 18 A.Y. 2013 - 14 PAGE NO ACIT VS . M/S. GUJARAT ALKALIES & CHEMICALS 6 GROUND NO. 3( D ELETING THE ADDITION OF RS. 13.86 LACS IN BOOK PROFIT ON ACCOUNT OF PRIOR PERIOD EXPENSES) 8. THE ASSESSEE HAS DEBITED R S. 13.86 LACS AS PRIOR PERIOD EXPENSES. THE ASSESSING OFFICER WAS OF TH E VIEW THAT PRIOR PERIOD EXPENSES WE RE NOT ALLOWABLE DEDUCTION AND ADDED THE PRIOR PERIOD EXPENSES TO THE BOOK PROFIT. THE LD. CIT(A) HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE AFTER FOLLOWING THE DECISION OF HIS PREDECESSOR FOR ASSESSMENT YEAR 2011 - 12. THE LD. COU N SEL HAS CONTENDED T HAT THE SIMILAR ISSUE ON IDENTICAL FACT S HAS BEEN DECIDED BY ITAT AHMEDAB A D IN FAVOUR OF THE ASESSEE VIDE ITA NO. 1589/AHD/2016. WE HAVE PERUSED THE ORDER OF ITAT AS CITED ABOVE AND IT IS NOTICED THAT THE ISSUE DECIDED IN THE APPEAL HAS BEEN ADJUDICATED IN FAVOUR OF THE ASSESSEE. THE RELEVANT PART OF THE DECISION IS AS UNDER: - 31. AT THE OUTSET, WE NOTE THAT THE IMPUGNED ISSUE HAS ALREADY BEEN ADJUDICATED ALONG WITH THE APPEAL OF THE ASSESSEE BEARING ITA NO.1455/AHD/20 17 BY DISMISSING THE GROUND OF APPEAL OF THE REVENUE. FOR THE DETAILED DISCUSSION, PLEASE REFER THE RELEVANT PARAGRAPH BEARING NO. 16 OF THIS ORDER. RESPECTFULLY FOLLOWING THE SAME, THE GROUND OF APPEAL OF THE REVENUE IS PARTLY ALLOWED. RESPECT FULLY FOLLOWING THE DECISION OF THE CO - ORDINATE B ENCH AS CITED ABOVE, THE APPEAL OF THE REVENUE IS DISMISSED. GROUND NO. 4 (DELETING THE UN - UTILISED MODVAT CREDIT IN RAW MATERIAL AMOUNTING TO RS. 8 , 02 , 40 , 605/ - ) 9. DURING ASSE SSMENT THE ASSESSING OFFICER NOTICED THAT AS PER AUDIT REPORT , THE ASSESSEE COMPANY WAS HAVING TOTAL AMOUNT OF UN - UTILIZED MODVAT CREDIT OF RAW MATERIAL AS ON 31 ST MARCH, 2013 AMOUNTING TO RS. 8 , 02 , 40 , 605/ - . THE ASSESSING OFFICER WAS OF THE VIEW THAT UN - UTILIZED MODVAT CREDIT WAS REQUIRED TO BE INCLUDED IN THE CLOSING STOCK OF RAW MATERIAL AND WORK IN PROGRESS. THEREFORE, AFTER APPLYING THE PROVISION OF I.T.A NO. 1425 /AHD/20 18 A.Y. 2013 - 14 PAGE NO ACIT VS . M/S. GUJARAT ALKALIES & CHEMICALS 7 SECTION 145A, THE ASSESSING OFFICER HAS ADDED THE UN - UTILIZED MODVAT CREDIT OF RS. 8 , 02 , 40 , 605/ - TO THE TOTAL INCOME OF THE ASSESSEE. 10. AGGRIEVED ASSESSEE HAS FILED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) HAS ALLOWED THE APPEAL OF THE ASSESSEE AFTER FOLLOWING THE DECISION OF HIS PREDECESSOR FOR ASSESSMENT YEAR 2012 - 13. 11. DURING THE COURSE OF APPELLATE PRO CEEDINGS BEFORE US, THE LD. COUNSEL HAS BROUGHT TO OUR NOTICE THAT IDENTICAL ISSUE ON SIMILAR FACT HAS BEEN ADJUDICATED IN FAVOUR OF THE ASS ESSEE BY ITAT AHMEDABAD VIDE ITA NO. 1589/AHD/2016 IN ASSESSMENT YEAR 2012 - 13. WE HAVE GONE THROUGH THE ABOVE CITED DECISION OF ITAT AHMEDABAD AND NOTICED THAT IDENTICAL ISSUE ON SIMILAR FACT HAS BEEN ADJUDICATED IN FAVOUR OF THE ASSESSEE. RELEVANT PART OF THE DECISION IS AS UNDER: - 36. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE PRECEDING DISCUSSION, WE NOTE THAT THE ASSESSEE HAS BEEN RECORDING ITS TRANSACTIONS OF PURCHASE, SALES, AND VALUATION OF INVENTORIES, NET OF MODVAT CONSISTENTLY. THUS, IF THE INVENTORY OF CLOSING STOCK IS ENHANCED BY THE AMO UNT OF MODVAT CREDIT ATTRIBUTABLE TO IT, THEN THE AMOUNT OF CORRESPONDING PURCHASES/OPENING STOCK SHOULD ALSO BE INCREASED BY THE SAID AMOUNT WHICH WILL RESULT IN TAX NEUTRAL EXERCISE. THUS, IN OUR CONSIDERED VIEW, THE ASSESSING OFFICER ERRED IN ENHANCING THE VALUE OF CLOSING STOCK WITHOUT GIVING EFFECT TO THE PURCHASES/ OPENING STOCK AS THE CASE MAY BE. IN THIS REGARD, WE FIND SUPPORT AND GUIDANCE FROM THE JUDGMENT OF HON BLE GUJARAT HIGH COURT IN THE CASE OF PR.CIT VS. GUJARAT GAS COMPANY LTD. IN TAX APP EAL NO.90 OF 2017 VIDE ORDER DATED 07/02/2017, WHEREIN IT WAS HELD AS UNDER: - 3.03. NOW, SO FAR AS QUESTION NO. [B] I.E. WITH RESPECT TO ADDITION MADE BY THE A.O. ON ACCOUNT OF UNUTILIZED MODVAT / CENVAT CREDIT OF RS. 56,08,089/ - IS CONNECTED, IT IS REQUIRE D TO BE NOTED THAT THE LEARNED TRIBUNAL HAS TAKEN NOTE THAT WITH RESPECT TO MODVAT RECEIVABLE ACCOUNT, THERE IS CORRESPONDING LESS DEBIT TO THE PURCHASE ACCOUNT AND HENCE TO THAT EXTENT THERE IS ALREADY INCOME OFFERED FOR TAX. IF THAT BE SO, THERE WAS NO Q UESTION OF FURTHER ADDING MODVAT / CENVAT CREDIT TO THE INCOME OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION. UNDER THE CIRCUMSTANCES, WE SEE NO REASON TO INTERFERE WITH THE IMPUGNED JUDGEMENT AND ORDER PASSED BY THE LEARNED TRIBUNAL SO FAR AS CONFIRMING THE ORDER PASSED BY THE LEARNED CIT(A) DELETING THE ADDITION MADE BY THE A.O. ON ACCOUNT OF UNUTILISED MODVAT / CENVAT CREDIT OF RS. 56,08,089/ - . WE ARE IN COMPLETE AGREEMENT WITH THE VIEW TAKEN BY THE LEARNED TRIBUNAL. RESPECTFULLY FOLLOWING THE JUDGMENT OF THE HON BLE JURISDICTIONAL COURTS, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT (A). HENCE THE GROUND OF APPEAL OF THE REVENUE IS DISMISSED. I.T.A NO. 1425 /AHD/20 18 A.Y. 2013 - 14 PAGE NO ACIT VS . M/S. GUJARAT ALKALIES & CHEMICALS 8 RESPECTFULLY FOLLOWI NG THE DECISION OF CO - ORDINATE B ENCH AS CITED ABOVE, WE DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE, THEREFORE, THE SAME IS DISMISSED. 12. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 19 - 12 - 201 9 SD/ - SD/ - ( MAHAVIR PRASAD ) ( A MARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 19 /12 /2019 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,