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TMI Blog2009 (12) TMI 1021X X X X Extracts X X X X X X X X Extracts X X X X ..... ct in deleting the addition of ₹ 27,47,258 on account of unutilized Modvat credit which had effect on the closing stock valuation and profits of the assessee." 2. During the course of assessment of the assessee, who is engaged in manufacture of plastic containers, bottles, caps, jars and cans, it was noted that auditors report had specified a sum of ₹ 27,47,258 as adjustments required under section 145A of the Income-tax Act, 1961 (in short "the Act"). The unit-wise details of such adjustments were given as under :- Place of Units Amount required to be adjusted with total income Sanaswadi ₹ 22,80,471 Masat ₹ 1,81,902 Pondichery ₹ 1,160 Sarigam ₹ 2,83,725 Total ₹ 27,47,258 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Further submission was that it had paid all the duties before due date of filing the return and even if such amount was to be added, deduction under section 43B of the Act was available to it. Ld. CIT(A) accepted assessee's contention, since according to him whether inclusive or exclusive method was followed for accounting excise duty it would not affect the profit of the assessee. According to the ld. CIT(A) assessee had already paid duty at the time of purchase and therefore, there was no question of disallowance under section 43B of the Act. Thus he deleted the addition made by Assessing Officer. 5. Now before us the ld. D.R. strongly supported the Assessing Officer. According to him in view of the stipulation contained in section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be done as stipulated in section 145A of the Act. If we go through section 145A of the Act the adjustments required on account of the amount of tax, duty, cess or fee actually paid or incurred by the assessee needs to be made for the valuation of purchase, sale of goods and inventory. Therefore, if assessee irrespective of the method followed by an assessee for accounting excise duty, adjustments as specified under section 145A of the Act are to be made. We find that the ld. Assessing Officer had simply relied on the comments in the auditors report for the adjustments to be carried out on closing stock on account of unutilized modvat credit balance but had not applied the section in toto. Ld. Assessing Officer ought have made the adjustme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the opinion that the Assessing Officer has to examine the issue afresh. Therefore, in the interest of justice we set aside the orders of CIT(A) and Assessing Officer in this regard and remit the matter back to the Assessing Officer for ascertaining the disallowance if any to be made under section 145A of the Act after taking into account the adjustments that are to be made in all the three elements viz., purchases, sales and inventories in respect of tax, duties and cess paid or incurred by the assessee. In the result, ground No. 1 of the revenue stands allowed for statistical purposes. 7. Ground No. 2 of the Revenue runs as under :- "2. On the facts and in the circumstances of the case and in law, the CIT(A) has erred in deleting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee from his employees' as contribution to any PF or superannuation fund or any fund set up under the provisions of Employees' State Insurance Act 1948, or any fund for the welfare of the employees". Thus all deductions made by the assessee from its employees' salary on any of the above heads would fall within the definition of income, no doubt. Thus in assessee's case PF amounts, insofar these were employees contribution, would be income in its hand. Deduction therefrom is allowed by section 36(1)(va) of the Act to the extent such sum is credited by the assessee to employees' account in relevant fund on or before the due date. Thus unless and until such remittances are made it remains assessee's income, an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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