2012 (11) TMI 1255

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....by : Heena Joshi O R D E R PER RAJENDRA SINGH, AM: This appeal by the revenue is directed against the order dated 18.4.2011 of CIT(A) for the assessment year 2007-08. The only dispute raised in this appeal is regarding valuation of closing stock. 2. The facts in brief are that the AO during the assessment proceedings noted that the assessee had valued stock costing Rs. 18.00 lacs at Rs....

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....basis for valuation of closing stock. The AO further observed that the stock has to be valued at cost price or market price whichever was lower and net realizable value adopted by the assessee was not permitted. The AO, therefore, rejected the valuation made and added the difference to the closing stock which came to Rs. 16,93,200/- (wrongly mentioned in the assessment order as Rs. 24,52,035/-). ....

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....ng but the market value. CIT(A) further observed that since unsold stocks were also lying for more than 5 years and had become obsolete, the assessee was justified in adopting net realizable value at much lower figure based on experience in business and principle of conservatism. CIT(A), therefore, deleted the addition made by AO aggrieved by which, the assessee is in appeal before the Tribunal. ....

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.... other hand supported the order of AO and placed reliance in the findings given in the assessment order. 4. We have perused the records and considered the matter carefully. The dispute is regarding addition made on account of valuation of closing stock. The assessee was dealing in locks. For the relevant year, the assessee had valued locks costing Rs. 18.00 lacs at Rs. 1,06,800/-. The case of t....