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TMI Blog2016 (3) TMI 1292X X X X Extracts X X X X X X X X Extracts X X X X ..... e business of shipping agent, software was used to facilitate assessee’s business of shipping, therefore, there is no reason to treat the expenditure on software as capital. Addition of closing balance of CENVAT credit on account of unutilized service tax credit u/s 145A - Held that:- Tssue with regard to applicability of Sec. 145A on unutilized service tax credit was considered by the Tribunal in assessee’s own case [2015 (8) TMI 312 - ITAT MUMBAI] as held this section only applies to purchase and sale of goods and inventory for the purpose of valuation of stock on the date of valuation. In the normal circumstances it is at the time of valuation of closing stock and not for the valuation of service contracts. If the provision of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n nature. By the impugned order, CIT(A) allowed assessee s claim against which revenue is in further appeal before us in both the years under consideration. 3. It was submitted by the ld. AR that the issue is covered by the order of the Tribunal in assessee s own case for A.Y 2006-07 vide order dt. 19.12.2014. We also find that the issue is also covered in favour of the assessee by the decision of the Hon'ble Bombay High Court in the case of Raychem RPG Ltd. (346 ITR 138), wherein it was held that software facilitate assessee s trading operations or enable the management to conduct assessee s business more efficiently or more profitably but it is not in the nature of profit-making apparatus. Therefore, expenditure on software was to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds and inventory for the purpose of determining the income chargeable under the head profit and gains has to be adjusted so as to include the amount of any tax, duty, cess, or fee paid or incurred by the assessee to bring the goods as on the date of valuation. This section only applies to purchase and sale of goods and inventory for the purpose of valuation of stock on the date of valuation. In the normal circumstances it is at the time of valuation of closing stock and not for the valuation of service contracts. If the provision of section 145A is not applicable on services, then the action of the AO in invoking the provisions of section 145A to make the addition is legally not correct. Accordingly on this reason, the order of the Ld. CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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