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TMI Blog2013 (9) TMI 1066X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Cross Objections filed by the assessee were heard together and are being disposed of by this consolidated order for the sake of convenience. 3. The revenue has raised the following grounds of appeal: "1. That the Ld. CIT(A)-II has erred in law and on facts in quashing the assessment by holding that reopening of assessment u/s 147 of the Income-tax Act, 1961 and issue of notice u/s 148 of the Income-tax Act, 1961 was not valid as there was no failure on the part of the assessee to disclose fully and truly all material facts relevant for assessment. 2. That the Ld. CIT(A)-II has erred in law and on facts in holding that even on merits also, the adjustments made by the A.O. for purpose of deductions u/s 80HHC were not valid and wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer and as declared by the assessee at Rs. 58,28,290/- was added as income of the assessee. 9. The CIT(Appeals) deleted the addition made by the Assessing Officer in view of the findings of Tribunal in assessee's own case relating to assessment year 2007-08. The CIT(Appeals), thus held that there was no reason to interfere with the method of valuation of closing stock adopted by the assessee and the rejection of books of account to adopt new method of valuation of closing stock was held to be wrong. The addition of Rs. 58,28,390/- was, thus deleted by the CIT(Appeals). 10. We have heard the rival contentions and perused the record. The assessee is engaged in the business of sale and purchase of jewellery. The assessee, in order to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... treated the surrendered amount of Rs. 26 lacs as deemed income. 5. In the course of assessment proceedings, the assessee informed the AO, that LIFO method of accounting was followed in valuation of closing stock. The contention of the assessee was not found acceptable by the AO. The AO, referred to A.S.-2, that specifies of only three methods of determining the cost of inventories i.e. specific identification method, FIFO and Weighted average cost method. The AO made an addition of Rs. 32,08,977/- following the weighted average cost method of the closing stock. The ld. CIT(A), on appreciation of the case laws and submissions filed before her, gave her findings in para 5.2 of the appellate order, which are reproduced hereunder : "5.2 I ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble and on that account, the additions made by the Inspecting Assistant Commissioner should be restored. In United Commercial Bank v. CIT [1999] 240 ITR 355, their Lordships of the Supreme Court held that the method which was consistently followed by the appellant-bank for valuing the stock-in-trade could not be rejected by the accessing authority in a particular year. " There is merit in the appellant's submissions that the principle of judicial discipline requires that the order of the Higher Appellate Authority should be followed unreservedly by the subordinate authorities. Therefore, in view of the above stated facts - assessee having consistently employed the same method of valuation of closing stock and AO having not questioned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessing Officer noted that there was a credit of Rs. 1,50,000/- on 15.12.2008 in the capital account of the assessee. The explanation of the assessee in this regard was that the said cheque had been received from M/s Good Faith Cement Pvt. Ltd. to whom the said amount was given on 07.09.2006. The assessee filed the confirmation from the said party. However, the notice issued by Assessing Officer under section 133 (6) of the Act was received back undelivered at the address given by the assessee. The assessee sought time to contact the said party and it was also pointed out that since the amount has been routed through banking channels, enquiries may be made from the bank. The Assessing Officer rejecting the explanation of the assessee an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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