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1 - 5 of 5 (1.36 seconds)Section 148 in The Income Tax Act, 1961 [Entire Act]
Section 139 in The Income Tax Act, 1961 [Entire Act]
Duple Motor Bodies Ltd. vs Inland Revenue Commissioners. Duple ... on 18 March, 1960
11. It was urged that the above valuation given in the balance-sheet did not disclose that the stock of yarn in process was valued at 12 nP. per kg. Petitioner, therefore, could not be said to have disclosed primary facts necessary for assessment for that year. As discussed above, the method of valuation adopted by the petitioner over a number of years was known to the Department. Since no departure was made, it should have been presumed that when the petitioner stated that yarn in process was valued at cost; it had valued stock at 12 nP. per kg. as in the past. It
could not, therefore, be said that the petitioner had not disclosed the primary facts. But apart from that, the petitioner was required to file the balance-sheet along with the return by virtue of the relevant provisions of the rules framed under the Act and that would mean that the balance-sheet so filed was part of the return itself. When the petitioner stated in the balance-sheet that the stock of yarn in process was valued at cost, the ITO should have been put on inquiry and it was his duty to find out what method the petitioner had followed in working out the cost of stock. As held by the House of Lords in Duple Motor Bodies Ltd. v. Ostime [1961] 39 TC 537, it is permissible to value stock at a figure higher or even lower than what is arrived at by showing cost method. Therefore, if, as urged on behalf of the Revenue, the method of valuation followed by the petitioner was not known to the ITO, assessing the petitioner to income-tax for the year under reference, it was his duty to investigate into the facts and find out what exactly was the method which was followed by the petitioner in valuing the stock and then to draw the correct inference on the basis of the facts found. On the facts and in the circumstances of the case, prima facie, the appendage of label which the petitioner gave to the method of valuation of stock of yarn, namely valuation of stock at cost, is not by itself a primary fact. But even assuming that the description accordingly given by the petitioner about the method of valuation constitutes a primary fact, it was the duty of the ITO to make an investigation into the facts and draw a correct inference from the facts found by him and to decide, inter alia, whether or not the stock can be said to have been valued at cost, as claimed by the petitioner having regard to the method adopted. It was not part of the duty or responsibility of the petitioner to advise the ITO with regard to the true and correct inferences which should be drawn from the primary facts as regards the method of valuation.
Section 153 in The Income Tax Act, 1961 [Entire Act]
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