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1 - 10 of 12 (0.41 seconds)The Income Tax Act, 1961
Commissioner Of Income-Tax vs Karnal Co-Operative Sugar Mills Ltd. on 23 April, 1999
13 The valuation of stock on the basis of average prices has
been held as valid in the case of CIT vs. Fazilka Co.operative
Sugar Mills Ltd. Reported in 255 ITR 411 ( P& H). The head note
is as under:
Commissioner Of Income-Tax, Bombay ... vs Citibank N.A. on 12 April, 1994
In this regard, I rely on the decision of Bombay High Court in the
case of CIT v. Citibank N. A. reported in [1994] 208 ITR 930 (Born).
The head note is as under:-
The Dy. Commissioner Of Income Tax, Spl. ... vs Otis Elevator Co. (I) Ltd. on 22 September, 2005
I further rely on the decision of Jurisdictional ITAT in the case of
Deputy Commissioner of Income-tax v. OTIS Elevator Co. (I) Ltd
reported in 284 ITR (AT) 173(ITAT, MUMBAI). The Head note is as
under:-
Chainrup Sampatram vs Commissioner Of Income-Tax,West ... on 9 October, 1953
12 In the case Chainrup Sampatram v. CIT [1953] reported in
24 ITR 481, the Hon'ble Supreme Court had laid down firstly, that
profits do not arise out of valuation of closing stock. Secondly, that
valuation of unsold stock at the close of the accounting period is a
necessary part of the process of determining the trading results and
it cannot be regarded as source of such profits. The addition made
to the closing stock cannot be regarded as a source of profit which
is nothing but a principle of balancing. The true purpose of crediting
the value of unsold stock is to balance the cost entered on the other
side of the account at the time of their purchase so that the
cancelling out of entries relating to the same stock from both the
sides of the accounts would leave only the transaction on which
there has been actual sales to show the profit or loss actually
realized. The revenue impact on such addition result in a revenue
neutral situation. Whatever addition once made to the closing stock
it is going to the opening stock in next year. In fact, there will not be
any leakage of revenue.
C.I.T. vs Jagatjit Industries Limited on 6 September, 2010
16. The recent decision of Delhi High Court in the case of
Commissioner of Income-tax v. Jagatjit Industries Ltd. reported in
339 ITR 382 is worth mentioning here. The findings of Hon.High
Court was that when the Department has accepted a particular
12
method of accounting system followed by the assessee
consistently, then the same cannot be rejected without valid
reason. The Assessing Officer has to follow the doctrine of
consistency. The head note is as under:-
Section 145A in The Income Tax Act, 1961 [Entire Act]
Messrs. Calcutta Company Ltd vs The Commissioner Of Income-Tax,West ... on 12 May, 1959
145. It is the duty of the Assessing Officer to compute the income of
the assessee in accordance with the method of accounting
regularly employed by the assessee. The only exception to the
legal position is provided in the first proviso to section 145 of the
Income-tax Act, 1961, i e., where true profits cannot be deduced
from the method of accounting employed by the assessee. If such
method of accounting depicts a distorted picture of the profits of
business carried on by the assessee, then the Assessing Officer
can invoke the first proviso to section 145 even though such
method is being employed consistently. But the powers of the
Assessing Officer under the first proviso are not arbitrary and must
be exercised in a judicious manner. The Supreme court decision in
the case of Calcutta Co. Ltd. v. CIT [1959] 37 ITR 1 (SC) followed.
Commissioner Of Income-Tax vs Indo Nippon Chemicals Co. Ltd. on 23 January, 2003
The above proposition has been laid
down in the case of CIT vs. Indo Nippon Chemical Company
Ltd. 245 ITR 384 (Born.).