Consistent stock valuation across accounting periods barred a revised opening stock figure; disallowance deleted.

Consistent stock valuation was required where the first period's profit had already been computed and accepted on a closing stock figure that necessarily became the opening stock for the second period. A different opening stock value could not be substituted for the later period without reopening the settled computation for the earlier period. On that basis, the revenue could not adopt inconsistent stock values across the two periods, and the disallowance was deleted in favour of the assessee.

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Issues: Whether the disallowance of loss for the second period was justified by adopting a different value for opening stock than the closing stock accepted for the first period.

Analysis: The accepted profit for the first period had already been computed on the basis of a closing stock figure of Rs. 2,87,000. The same figure necessarily represented the opening stock for the second period. A different opening stock value could not be substituted for the second period without reopening the settled computation for the first period. Since the first period's profit had attained finality, the revenue could not adopt inconsistent stock valuations for the two periods.

Conclusion: The disallowance of Rs. 51,429 was deleted and the assessee succeeded.

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