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TMI Blog2012 (10) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... of Income-tax (Appeals) on 12.01.2007 in relation to the assessment year 2003-04. 2. It merits to mention that the assessee has raised an additional ground which is without prejudice to ground no.2 raised in the memo of appeal. Through this additional ground it has been contended that if the addition is to be sustained u/s 145A then the corresponding adjustment should be made in the value of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee-company erroneously claimed credit of Modvat on the raw material and packing material on the basis of purchase and not on the basis of consumption. The Assessing Officer was not satisfied with the assessee's contention. He, therefore, made the addition. The learned CIT(A) upheld the addition so made by the Assessing Officer. 4. Having heard both sides and perused the relevant materi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sales, opening and closing stock. It is not appropriate to include the closing Modvat in the figure of closing stock without modifying the figures of purchases, sales and opening stock. The Hon'ble jurisdictional High Court in CIT v. Mahalaxmi Glass Works Pvt. Ltd. [(2009) 318 ITR 116 (Bom.)] and the Hon'ble Delhi High Court in CIT v. Mahavir Alluminium [(2008) 297 ITR 77 (Del.)] have held to this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on was made by the A.O. It was argued before the ld. first appellate authority that the TPO ought to have allowed standard adjustment of 5% before making addition as per proviso to section 92C(2). The learned CIT(A) rejected this contention by holding that since the ALP exceeded the price declared by the assessee by more than 5%, the entire excess was liable to be added. It is this direction of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... option. The learned AR was fair enough to concede that the retrospective amendment by the Finance Act, 2012 has the effect of upholding the opinion taken by the learned CIT(A). In view of this amendment to section 92C, we hold that the learned CIT(A) was justified in not granting standard adjustment of 5%. This ground is not allowed. 7. In the result, the appeal is partly allowed for statistical ..... X X X X Extracts X X X X X X X X Extracts X X X X
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