TaxTMI 
TaxTMI 
2003 (3) TMI 80
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....nce of Rs. 11,82,35,007?" Facts: The assessee is a nationalised bank. The assessee-bank had in its possession, during the relevant assessment year, shares and securities worth several crores. The method of valuation followed by the assessee was to value investments at cost or market value whichever was lower. During the year of account, depreciation with regard to securities held by the assessee was to the tune of Rs. 11,82,35,007. The assessee-bank claimed deduction. This was disallowed by the Income-tax Officer. The assessee-bank went in appeal to the Commissioner of Income-tax (Appeals), who took the view that the said investments were rightly valued at the end of the year at cost or market value whichever was lower and the difference ....
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.... final account of, the assessee-bank. That, since the investment trading account was not incorporated in the final account, the assessee-bank had no right to calculate profit or loss arising out of the investment trading account. In that matter, the assessee-bank was following the mercantile system of accounting and the loss claimed by the assessee was not debited in the profit and loss account. Against the order of the Commissioner under section 263 of the Act, the assessee-bank preferred an appeal to the Tribunal which took the view that the assessee had claimed the loss by following the same method which it was following for the last 30 years. Consequently, the order passed by the Commissioner under section 263 was set aside. Against the....
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....er section 53 of the Banking Regulation Act, 1949, the Central Government on the recommendation of the Reserve Bank of India had issued a notification for banks in respect of the assessments to the effect that Note (f) shall not apply to the United Commercial Bank in respect of its balance-sheet. On the basis of the said notification, the United Commercial Bank did not mention the market value of the investments. In the circumstances, the Supreme Court came to the conclusion that from the form of the prescribed balance-sheet, it was evident that the nationalised banks were directed to put the value of shares and securities at cost and if the market value was lower than the cost then, it was to be shown separately in brackets. Before the Sup....
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....e the true picture of profits and gains. That, for determining the real income, the entries in the balance-sheet were required to be maintained in the statutory form. However, such entries in the balance-sheet were not decisive or conclusive. In such cases, it was open to the Income-tax Officer and the assessee to ascertain the true and proper income while submitting the income-tax returns. That, for valuing the closing stock, it was open to the assessee to value the stock at cost or market price whichever is lower. That, the assessee was valuing the stock-in-trade at cost for the purposes of statutory balance-sheet but, for the purposes of the income-tax return, the assessee was valuing the stock-in-trade at cost or market value whichever ....