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2019 (12) TMI 668 - AT - Income TaxAddition of value of closing stock being diminution in the value of closing stock and claiming depreciation therein - HELD THAT:- The assessee computed his income according to cash or mercantile system of accounting in term of section 145 and accounting standards notified by the Government of India from time to time. The assessee values its closing stock at lower than the cost or net reliable value and to arrive at the valuation of closing stock from the perspective of accounting standards. The assessee reduced the value of certain items from closing stock to appropriate reflect its net reasonable value which is lower than the cost. The said reduction from the cost represents the wear and tear of the stocks of the items which are lying in the inventory/showrooms. We noted that there is no factual difference in this year and any adjustment in the closing stock for the year no. 1 would consequently result in the adjustment to the opening stock of year No. 2. Further, we noted that the assessee has filed complete details of valuation of closing stock in its paper book along with statements showing details of subsequent sales with regard to the items of closing stock which were revalued to net reliable value along with sample copies of invoices with respect of subsequent sales. From those details it is clear that net reasonable value adoptable by the assessee for the purpose of value of closing stock in certain cases is as per the prevailing accounting practices as accounting standards 2. Hence, we find that no infirmity in the order of CIT(A) and respectfully following the Tribunals decision for AY 2012-13, we confirm the order of CIT(A) and deleting the addition. Adjustment made while computing book profit under section 115JB to the closing stock - HELD THAT:- We find that this issue is answered in the first issue and the same finding will apply here also. Hence, we confirm the order of CIT(A) deleting the addition. Disallowance of provision for leave encashment under section 43B - HELD THAT:- Calcutta High court in the case of Exide Industries Limited And Anr. vs Union Of India (UOI) [2007 (6) TMI 175 - CALCUTTA HIGH COURT] whereby the provision of section 43B(J) of the Act struck down as arbitrary but stayed and is pending before Hon’ble Supreme court . Hence, it was requested that the matter can be kept pending till the decision of Hon’ble supreme court. On this, we require the learned DR, to explain the situation. He only requested that this matter can be referred back to the file of the Assessing Officer who will decide in term of the Hon’ble Supreme Court decision. After hearing both the sides and going through the records, we restore the matter back to the file of the Assessing Officer to decide the claim of assessee in term of the decision of Hon’ble Supreme Court in the case of Excide Industries [2007 (6) TMI 175 - CALCUTTA HIGH COURT] . This issue of the assessee’s CO is set aside to the file of the Assessing Officer.
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