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2005 (7) TMI 92 - ALLAHABAD HIGH COURTValuation Of Stock - Whether the Tribunal was justified in holding that the value of work-in-progress was to be taken at the cost of raw material consumed and no part of direct labour, overheads was allocable to it - HELD THAT:- We do not find any error in the order of the Tribunal. It is settled principle of law that the stock can be valued at the cost or at market rate. Admittedly, the assessee had been manufacturing the goods, which were tailor-made for specific requirements of its customers and unless the whole of the machinery is complete, work-in-progress by itself has no other utility. The assessee has valued the work-in-progress on the basis of raw material consumed at cost price. This method has been adopted since last several years and also in subsequent years. No objection has been raised by the Revenue in the previous years to such valuation. It was found that assessee-company was a progressive company and shown out profits on progressive scale from year to year and cannot escape from the clutches of the Revenue. The closing stock of this year is the opening stock of the subsequent year and, hence, a consistent method adopted for valuation by the assessee should not be disturbed. Therefore, the same method adopted in the year under consideration for valuing the stock, as has been adopted in the previous years, cannot be said to be unjustified. Thus, we answer the question referred to us in affirmative, i.e., in favour of the assessee and against the Revenue.
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