https://www.taxtmi.com/caselaws?id=285498 Valuation of work in progress for income-tax purposes is a fact-specific exercise governed by ordinary commercial accounting practice and whether the resulting figure fairly reflects profits. The direct cost method and the on-cost method are not universal rules of law, and neither can be applied mechanically in every case. On the facts discussed, the on-cost method was said to produce an inflated and unrealistic valuation because slack business conditions caused a larger share of overheads to be attributed to work in progress. The assessment therefore turned on whether the chosen method fairly stated taxable profits for the relevant years. en-us Fri, 18 Mar 1960 00:00:00 +0530 Wed, 15 Jan 2020 16:48:01 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=285498 Valuation of work in progress for income-tax purposes is a fact-specific exercise governed by ordinary commercial accounting practice and whether the resulting figure fairly reflects profits. The direct cost method and the on-cost method are not universal rules of law, and neither can be applied mechanically in every case. On the facts discussed, the on-cost method was said to produce an inflated and unrealistic valuation because slack business conditions caused a larger share of overheads to be attributed to work in progress. The assessment therefore turned on whether the chosen method fairly stated taxable profits for the relevant years. Case-Laws Income Tax Fri, 18 Mar 1960 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=285498