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2010 (10) TMI 758 - AT - Income TaxAddition - Valuation of closing stock - Applicability of As-1 or As-7 - The assessee company was in the business of Market Research, and it is not the case of department that the work in progress as shown by the assessee was incurred in relation to construction activities - Therefore, Accounting Standard-2 is applicable in the present case and not the Accounting Standard-7, dealing with accounting of construction contracts - The assessee had filed its opening and closing WIP based on direct cost - The interest was not included in the valuation of WIP - Since, the valuation had been done as per Accounting Standard-2, the same was required to be accepted in view of the provisions of section 145(2), wherein Accounting Standard-2 has been notified to be followed - Decided in favour of assessee. Bad debts - After 1st April, 1989, it is not necessary for the assessee to establish that the debt, in fact, has become irrecoverable - It is enough if the bad debt is written off as irrecoverable in the accounts of the assessee." There is no dispute about the amount having been actually written off - Decided in favour of assessee. Interest on work in progress - This issue has already been considered in assessment year 2004-05 vide ITA No.7257/Mum/2008 and for the reasons contained therein, dismiss this ground of appeal - Decided in favour of assessee.
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