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TMI Blog2020 (10) TMI 879X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee has not included such taxes in the amount of purchases, sales and closing stock. We note that if such taxes are included in the opening stock, purchase, sales and closing stock then there will not be any difference in the total income declared by the assessee. It is because such exercise is tax neutral in the given facts and the circumstances. Assessee has placed a chart in the paper book which is placed depicting the profit under both the method of accounting i.e. inclusive and exclusive method of accounting as provided u/s 145A of the Act. On perusal of the chart there is no difference in the profit declared by the assessee except a minor difference of ₹ 5091/- only. See PUNEET INDUSTRIES PVT. LTD. [ 2016 (6) TMI 116 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zed CENVAT credit amounting to ₹ 3,80,07,933/- in its balance sheet as on 31/03/2006. As per the AO the amount of unutilized CENVAT credit was to be included in the value of closing stock in pursuance to the provision of section 145A of the Act but the same has not been done so. Accordingly AO was of the view that the assessee has shown less income by ₹ 3,80,07,933/- by not including unutilized CENVAT credit in the value of closing stock shown as on 31/03/2006. Thus the AO added the same to the total income of the assessee. 4. Aggrieved assessee preferred an appeal to the ''Ld.CIT (A)'' who deleted the addition made by the AO by observing as under. it is found that the appellant is maintaining exclusive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and closing stock. However, we note that if such taxes are included in the opening stock, purchase, sales and closing stock then there will not be any difference in the total income declared by the assessee. It is because such exercise is tax neutral in the given facts and the circumstances. 6.1 We also find that the same plea was also taken by the assessee before the AO as evident below. Without prejudice to the above, it is further stated that the MODVAT/CENVAT balances as appearing in the books of accounts and shown as assets in the balance sheet have not been claimed by way of expenditure while drawing our the P L A/C. As a consequence of this the question of including the same while valuing the closing stocks does not arise. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unting and the CENVAT was not debited or credited to the Profit Loss account and the aforesaid method has been consistently followed by the assessee in earlier and succeeding years. We further find that the Hon'ble Apex Court in the case of CIT vs. Indo Nippon Chemicals Co. Ltd. reported at (2003) 261 ITR 275 (SC) observed that unavailed MOD VAT credit cannot be construed as income and there is no liability to pay tax on such unavailed MODVAT credit. Further, before us, Revenue has not brought any contrary binding decision in its support. In view of the aforesaid facts, we do not see any reason to interfere with the order of the ld.CIT(A). Thus, the ground of Revenue is dismissed. In view of the above, we note that there is no i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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