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2017 (6) TMI 456 - HC - Income TaxRevaluation of closing stock of the polished diamonds - addition to income - rectification application - as per assessee the Revenue as well as the Tribunal having discarded the assessee's method of valuing closing stock and substituted such methodology by another formula, same principle must apply for valuing the opening stock - Held that:- This was a case where the Revenue's contention about correct formula for valuing closing stock became final. If that be so, the same principles would apply also for valuing the opening stock. Only then the correct tax liability of the assessee could be ascertained. Merely decreasing the closing stock valuation by ₹ 66.90 lakhs, the Revenue cannot categorize it as the additional income of the assessee. In plain terms, same exercise would have to be undertaken for revaluing the opening stock and whatever the difference would reflect the true computation of the assessee's income for the year under consideration. when the Revenue or the Tribunal was modifying or substituting the method of valuation of closing stock of the assessee in a particular year as a necessary corollary, the same methodology would have to be applied for the purpose of computation of the opening stock for that year also. The issue being absolutely clear, perhaps the Tribunal on its own, could also have provided for it while disposing of the Tax Appeal itself whether specifically so argued by the assessee or not. When the assessee therefore applied for rectification at that stage, at least, the Tribunal could have accepted the request of the assessee. The Tribunal therefore, committed the serious error in rejecting the rectification application on the ground that no such argument was advanced at the time of hearing of the appeal. Thus impugned order of the Tribunal dated 09.02.2012 is set aside. Petitioner's request for rectification of the Tribunal's order dated 30.04.2008 is granted to the extent of directing that valuation of the opening stock of polished diamonds of the assessee for the assessment year 2003-04 shall be done on the same basis as the Assessing Officer has applied for the purpose of valuation of the closing stock of that year.
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