Indian Forest Industries P. Ltd. Vs. Income Tax Officer, Ward-12(1)

Parties Involved

Facts Summary

The assessee filed its original return of income for AY 2018-19 on 29.09.2018. At the time of filing Audit Report, the Auditors inadvertently marked 'Yes' instead of 'No' in Column 14.b against the query 'deviation from the method of valuation prescribed under section 145A'. Subsequently, the Auditors clarified that there was no change in the method of stock valuation and the assessee had been consistently following the same method as in preceding assessment years. The CPC made an addition of Rs.14,29,702/- on account of alleged change in method of valuation of stock. The assessee filed a rectification petition u/s.154 of the Act before the Assessing Officer (AO), which was rejected. The assessee then filed an appeal before the CIT(A), which was dismissed. The assessee contends that since there has been no change in the method of accounting of closing stock, the addition should be deleted.…

Legal Issues

• 1. Addition of Rs.14,29,702/- on account of alleged change in method of valuation of stock.

Judgment Outcome

Decided in favour of Assessee.

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