Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (12) TMI 239 - ITAT CHANDIGARHAddition on account of undervaluation of closing stock of land – The company M/s. Amritsar Rayon and Silk Mills P. Ltd. filed a suit against the assessee on March 11, 2006 which had an adverse impact on the market value of the impugned asset - The assessee had paid Rs. 70 lakhs to M/s. Amritsar Rayon and Silk Mills P. Ltd. - Held that:- The Legal dispute has adversely impacted the price of land - The assessee had paid Rs. 70 lakhs to M/s. Amritsar Rayon and Silk Mills P. Ltd. and finally the matter was settled at Rs. 2.30 crores - M/s. Amritsar Rayon and Silk Mills P. Ltd. had filed a suit for recovery of Rs. 1,08,00,000 being the double of advance amount paid as earnest money to the tune of Rs. 54 lakhs - The Revenue, itself did not challenge the opening stock of the impugned asset in the subsequent assessment year, while passing the assessment order under section 143(3), and accepted the same. There is no change in the method of valuing of the closing stock - As cost or market price whichever is less was consistently followed – The copy tax audit report for the assessment year 2006-07 filed shows method of valuation of closing stock as cost or net realizable value whichever is less - Against the column 'details of deviation, if any from the method of valuation prescribed under section 145A and effect thereof on the profit and loss' it is clearly mentioned nil – This shows that there was no change in method of valuation of closing stock – Decided against Revenue.
|