Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2018 (6) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (6) TMI 1475 - HC - Income TaxAccounting principle being followed by the assessee bank for valuation of stock - determination of real income - Tribunal held that the assessee is not entitled to value the shares and securities which were held to be its stock in trade on the basis of the cost or market price whichever is lower as claimed in the return - Held that:- On an appreciation of the case of The United Commercial Bank case [1999 (9) TMI 4 - SUPREME COURT] it clearly appears that the court stressed on the determination of real income rather than theoretical principles of accountancy. It says that if the securities and shares were valued at cost and from that no firm conclusion could be drawn a tax payer was free to employ his own method of keeping accounts to value the stock in trade whether at cost or market price. Then it went on to say that the emphasis was on determination of real income. Again it observed that where from the computation, the real income could not be properly deduced, the computation should be made in the manner determined by the Income Tax officer. We think that the computation made by the assessee for the subject assessment year does not disclose the real income and that changing the method of valuation of closing stock to cost or market price whichever was lower would determine the income correctly.
|