hereinafter referred to as Lakhanpal National Ltd. s case in support of its claim.
98,25,833 being customs and excise duty including in the value of the opening stock.
5,85,87,181/ being the duties actually paid during the relevant previous year.
At the instance of the Revenue, the following question of law was referred to the High Court for the assessment year 1986 87 Whether, on the facts and in the circumstances of the case and under Explanation 2 to section 43B companying into force with effect from 1.4.84, the Tribunal was justified in directing to allow the amount of Rs.
to allow the sum of Rs.
2004 2 SCR 502 The Judgment of the Court was delivered by SRIKRISHNA, J. Leave granted.
For the assessment year 1987 88.
In addition there to the petitioner had also credited to the Profit and Loss Account of the relevant previous year an amount of Rs.
1,33,31,370 as income.
For the assessment year 1986 87, the Tribunal upheld the claim of the assessee and allowed a deduction amounting to Rs.
Similarly, for the assessment year 1986 87, the petitioner claimed a deduction of Rs.
During the previous year ending on 31st December 1983 pertaining to the assessment year 1984 85, the petitioner in its returns had disclosed a sum of Rs.
5,85,87,181 being the duties actually paid during the relevant year previous to the assessment year 1984 85.
During the assessment proceedings for the assessment year 1984 85, the appellant assessee claimed that under Section 43B of the Income Tax Act, 1961 hereinafter referred to as the Act that it was entitled to deduction of the entire sum of Rs.
77,81.948 u s. 43B of the I.T. Act.
the Tribunal allowed a similar claim and a reference came to be made to the High Court in the following terms Whether, on the facts and in the circumstances of the case, the Tribunal is justified in law in directing the I.TO.
77,81,739 Rs.
The Commissioner of Income Tax initiated proceedings under Section 263 of the Act on the ground that the Assessing Officer had wrongly allowed the claim for deduction of an amount of Rs.98,25,833 towards customs and excise duty paid during the previous year but credited to the Profit and Loss Account in closing stock of goods under the provisions of Section 43B. The assessee relied upon the judgment of the Gujarat High Court in Lakhanpal National Ltd. v. ITO, 1986 162 ITR 240 Guj.
In the assessment proceedings of the assessment year 1984 85, the Inspecting Assistant Commissioner of Income Tax allowed the appellant assessees claim that it was entitled to deduct the entire sum of Rs.
Being aggrieved, the assessee impugns both judgments of the Calcutta High Court pertaining to the three assessment years, by these appeals.
1,22,54,261 being the actual customs and excise duty included in the value of the closing stock for the previous year pertaining to the assessment year 1986 87 and offered for tax a sum of Rs.
24,28,428 Rs.
An application made for certificate to appeal to this companyrt under Section 261 of the Act was rejected by the Calcutta High Court by observing we are unable ourselves to burden an already over burdened Honble Supreme Court.
77,81,948 claimed under Section 43B of the Act being Central Excise and Customs duty, which had been included in the value of the closing stock.
The High Court by its judgment dated 24th September, 2001 in ITR No.
1,22,54,261 Rs.
98,25,833.
2,00,36,000 Rs.
1,22,54,261 on similar basis for the assessment year 1987 88.
The High Court by its judgment dated 6th February, 2002 disposed off both the references.
On similar basis, the appellant assessee had claimed a deduction of an amount of Rs.
The assessee claimed a deduction of Rs.
During this period, the appellant assessee had incurred expenditure on account of customs and excise duty aggregating to Rs.5,85,87,181 which was duly debited to the Profit and Loss Account of the petitioner for the relevant previous year and was also fully paid during the relevant previous year.
being Central Excise and Customs duty which had been included in the value of closing stock.?
213 of 1993 answered the question referred in favour of the Revenue and against the assessee.
The questions referred in both the references were answered in favour of the Revenue and against the assessee.
98,25,833 relatable to the customs and excise duty on the closing stock of inventory by including the said sum in the valuation of such closing stock.
24,28,428 being Central Excise and Customs duty under Section 43B of the Act on the ground that the said amount has been included in the value of closing stock.?
98,25,833 paid in the year of account and debited in the Profit Loss Account, on the ground the crediting of the Profit Loss Account by the value of the closing stock, which included the aforesaid duties, did number have the effect of wiping out the debit to the Profit Loss Account?
The assessee is a companypany engaged in the manufacture and sale of paints, varnishes and other allied products.
The Commissioner of Income Tax took the view that the Gujarat High Courts decision was distinguishable on facts and, therefore, made an order under Section 263 of the Act disallowing the claim of the assessee.
On appeal to the Tribunal the Tribunal held that the Gujarat High Courts judgment in Lakhanpal National Ltds case was distinguishable and companyfirmed the order of the Commissioner of Income Tax.
