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Issues involved: Valuation of closing stock for assessment years 1981-82 to 1984-85, consistency of valuation method, treatment of dieselising expenditure.
Valuation of Closing Stock (1981-82 to 1984-85): The main issue in the appeals was the valuation of closing stock of gold and silver jewellery for the mentioned assessment years. The Assessing Officer (AO) valued the closing stock differently from the assessee, resulting in additions to the income for the respective years. The Commissioner (Appeals) accepted the assessee's method of valuation, which had been consistently followed for over 15 years, stating that it did not lead to any understatement of income. The Commissioner held that the AO's attempt to unsettle the accepted method was unwarranted, and thus allowed the assessee's appeals. Consistency of Valuation Method: The assessee contended that their method of valuing closing stock, based on a moving average and last-in, first-out principle, had been accepted by the department for several years. The counsel for the assessee argued that the department should not disturb a method that has been consistently followed and accepted. Various legal references were cited to support this argument, emphasizing the importance of adhering to a recognized accounting method unless there are valid reasons to change it. Treatment of Dieselising Expenditure: The revenue raised concerns regarding the treatment of dieselising expenditure for the assessment years 1981-82 and 1982-83. They argued that certain expenditures should have been disallowed or corrected based on previous claims and legal precedents. However, the Commissioner (Appeals) dismissed these grounds, stating that there was no basis for disallowance or correction as per the facts presented. In conclusion, the Appellate Tribunal upheld the Commissioner (Appeals)' decision, confirming the valuation method of the closing stock adopted by the assessee and dismissing the revenue's appeals regarding the treatment of dieselising expenditure.
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