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TMI Blog2023 (9) TMI 609X X X X Extracts X X X X X X X X Extracts X X X X ..... ary any of the grounds of appeal." 3. At the outset, Ld. Counsel for the assessee, informs the Bench that assessee does not wish to press ground no.2; therefore we dismiss ground no.2 raised by assessee as not pressed. 4. We note that appeal filed by the assessee for assessment year (AY).2017-18, is barred by limitation by one hundred three (103) days. The Learned Counsel for the assessee moved a petition/affidavit, requesting the Bench to condone the delay. The contents of the affidavit filed by the assessee for condonation of delay, are reproduced below: "AFFIDAVIT 1) I, Vitthalbhai Karamshibhi Gabani, aged 61 years of 13, Gurunagar Society, Opp. Baroda Prestige, Varachha Road, Surat-395006, state on solemn affirmation as under. 2) I say that I am one of the partners of Keshri Exports having PAN ABKPG0905D. 3) During the Income-tax assessment year 2017-18, Keshri Exports has filed appeal before the Income-tax Appellate Tribunal, Surat with a delay of 103 days stated as under. (4) Primarily, delay occurred in filing the appeal is on account of the unit of Keshri Exports totally closed down with entire manufacturing activity suspended since 2016. Keshri Exports sold its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m, Perinadu Village v. Bhargavi Amma (Dead) by LRs, (2008) 8 SCC 321, the Hon'ble Supreme Court had enunciated certain principles which are applicable while considering applications for condonation of delay under Section 5 which may be summarized as follows: (i) The words "sufficient cause", as appearing in Section 5 of Limitation Act, should receive a liberal construction when the, delay is not on account of any dilatory tactics, want of bona fides, deliberate inaction or negligence on the part of the applicant/assessee, in order to advance substantial justice. The words "sufficient cause" for not making the application within the period of limitation" should be understood and applied in a reasonable, pragmatic, practical and liberal manner, depending upon the facts and circumstances of the case. (ii) The decisive factor in condonation of delay is not the length of delay but sufficiency of a satisfactory explanation. (iii) The degree of leniency to be shown by a court depends on the nature of application and facts and circumstances of the case. For example, courts view delays in making applications in a pending appeal more leniently than delays in the institution of an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tary evidences. 11. In response, the assessee, vide its submission dated 18.11.2019, has stated that closing stock of finished goods has been valued in the same manner as the opening stock of finished goods. All that has happened during the year is sale of inventories out of opening stock of finished goods. The assessee explained with help of Schedule-7 of the audited financial statements, which would show how the inventories have been reduced from the opening inventories to absorb against sales. The audited accounts have been submitted by assessee before the assessing officer. 12. However, the assessing officer rejected the contention of the assessee and observed that assessee has shown valuation of stock of polished diamond at Rs. 11,844/- per carat, whereas the closing stock was valued at Rs. 10,617/- per carat. There is no purchase of finished goods during the year. The assessee should have valued the closing stock of finished diamonds at the rate of 11,844/- instead of Rs. 10,617/-. Accordingly the value of closing stock was arrived at by the assessing officer by adopting the rate at which opening stock has been valued as under: Closing stock in quantity Total Value Rat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if the assessing officer finds any mistakes and errors in the documents and evidences submitted by the assessee and mistake in the audited books, the assessing officer may make line by line addition without rejecting books of accounts of assessee. If the assessee did not compute the correct value of closing stock, the assessing officer may compute the correct value of closing stock by applying accounting standards and principles, and for that AO need not to reject the books of accounts of the assessee. Therefore, ld DR has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. Therefore, ld DR contended that relief given by the ld CIT(A) should be reversed and addition made by the assessing officer may be upheld. 16. We have heard both the parties and carefully gone through the submissions put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the facts of the case including the findings of the ld. CIT(A) and other material brought on record. We also considered the various decisions relied by ld. counsel for assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee in respect of opening stock and closing stock. Therefore, we note that it was not necessary to reject the books of accounts of the assessee. Hence assessing officer was right in not rejecting the books of accounts. However, the assessing officer noticed that some details were not filed or annexed with tax audit report, as noted by ld CIT(A), therefore assessing officer made addition. On appeal by the assessee, we note that ld CIT(A) has provided enough relief to the assessee based on the audited books of accounts of the assessee. The relief provided by the ld CIT(A), by following the accounting standards and accounting principles are as follows: "9.9 From the ratio of the above case law, it is justified to take the average rate per ct in place of the rate per ct at a particular point of time. Accordingly, I direct the Assessing Officer to adopt average rate per ct to compute the value of closing stock. The computation of closing stock by adopting average rate per ct is as under: 1 Rate per ct adopted by the Assessee to arrive value of opening stock Rs.11844 2 Rate per ct adopted by the appellate to arrive value of closing stock Rs.10617 3 Average rate p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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