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Delhi High CourtIndian Cases

Commissioner Of Income Tax vs Nestle India Ltd. on 6 July 2006

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Delhi High Court
Commissioner Of Income Tax vs Nestle India Ltd. on 6 July, 2006
Equivalent citations: (2006)206CTR(DEL)345
Bench: Madan B. Lokur, Vipin Sanghi
ORDER
1. The Revenue is aggrieved by an order dt. 19th Sept., 2001 passed by the Tribunal. Delhi Bench ‘B’ in ITA No. 3862/Del/1996 for the relevant asst. yr. 1991 -92 and other connected appeals.

2. It appears that for the asst. yr. 1984-85, the assessed changed its method of accounting for the purpose of valuation of its closing stock by excluding the excise duty on goods that were cleared but not sold. The correctness of this action was questioned by AO, who did not accept the assessed’s change in its method of accounting. The CIT(A) rejected the assessed’s appeal. However, the assessed succeeded before the Tribunal. The decision of the Tribunal is reported as ITO v. Food Specialties Ltd. (1994) 48 TTJ (Del)(SB) 621 : (1994) 49 ITD 21 (Del)(SB).

3. Our order-sheets show that on earlier occasions it was stated that the Revenue had filed an application under Section 256(1) of the IT Act seeking reference of a question of law that had arisen as a result of the decision of the Tribunal. The details with regard to that application were not placed before this Court despite several opportunities and eventually on 24th Oct., 2005 it was directed that in case appropriate orders are not passed by the Tribunal in respect of the application under Section 256(1) of the Act, learned Counsel for the Revenue shall argue the present appeal. The Revenue was granted liberty to seek expeditious disposal of the pending application before the Tribunal.

Today, it has been brought to our notice that the application is not traceable and it is for this reason that we have proceeded to hear this appeal.

4. In the case before us, the assessed raised submissions before the Tribunal to the effect that the Departmental Authorities had erred in not accepting the assessed’s method of valuing the closing stock, and also the alternative submission that the excise duty paid had to be deducted from the valuation of the stock in order to give full effect to the provisions of Section 43B of the Act.

5. Insofar as the first submission is concerned, it was not canvassed before us being a subject-matter of proceedings relevant to the asst. yr. 1984-85. Since that issue is not before us today, we do not propose to comment on it. It is only the alternate submission that has been canvassed before us.

6. We find from the order passed by the Tribunal that the alternate issue had earlier arisen in Indian Communication Network (P) Ltd. v. IAC (1994) 48 TTJ (Del)(SB) 604 : (1994) 206 ITR 96 (Del)(SB)(AT). The decision of the Tribunal in Indian Communication Network Ltd. (supra) was followed by a Special Bench of the Tribunal in the case of the assessed itself. The decision in the case of the assessed is reported as (1994) 48 TTJ (Del) 621 : (1994) 49 ITD 21 (Del) (supra).

7. Learned Counsel for the assessed brought to our notice that in the decision of the Supreme Court in Berger Paints India Ltd. v. CIT the Supreme Court has noted at p. 104 that the decision of the Special Bench of the Tribunal in Indian Communication Network (P) Ltd. (supra) has not been challenged by the Revenue and this fact is not disputed by the Revenue.

8. Under the circumstances, since the Revenue has already accepted the decision which is the foundation of the conclusion arrived at by the Tribunal in the present case, we are of the view that no substantial question of law arises for our consideration.

Dismissed.