TaxTMI 
TaxTMI 
2019 (2) TMI 359
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....,589/- levied by the ld. AO u/s 271(1)(c) of the Income Tax Act, 1961. Relief may kindly be given by deleting the same." 2. The assessee is an individual engaged in the business of manufacturing of Pulses (Dal) and trading of Gemstones and assessee is also earning rental income. During the course of assessment proceedings U/s 143(3) of the Act the AO made an addition on account of undervaluation of closing stock of various Dals by taking the value at cost instead of the valuation adopted by the assessee at market rate. Thus, the AO made an addition of Rs. 6,80,767/-. The assessee did not challenge the said addition made by the AO. Subsequently the AO initiated the proceedings for levy of penalty U/s 271(1)(c) of the Act and levied the pen....
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....e valuation done by the AO, hence, the assessee has not taken the benefit of the enhanced valuation of the closing stock made by the AO. In support of his contention, he has relied on the order of the Coordinate Bench dated 29.08.2018 in case of Janta Construction Co. vs ACIT in ITA No. 578/JP/2018. Thus, the ld. AR of the assessee has submitted that an identical issue was considered by this Tribunal where the penalty was levied by the AO against the addition made on account of valuation closing stock. 4. On the other hand, the ld. DR has referred to the order of the Assessing Officer and submitted that the AO clearly mentioned that the assessee in his audit report has mentioned that the closing stock is valued at cost, however, the AO has....
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....receding year is taken as opening stock of the subsequent year. Apart from applying a different method the AO did not find any other discrepancy or deficiency in the closing stock of the assessee. We note that the Coordinate Bench of this Tribunal in case of M/s Janta Construction Co. vs. ACIT (supra) while considering the issue of penalty U/s 271(1)(c) against the addition on account of valuation of closing stock has held in para 4 as under:- "4. We have considered the rival submissions as well as the relevant material on record. There is no dispute that the addition made by the AO of Rs. 14,25,059/- on account of suppression of closing work in progress has attained the finality. However, the said addition was made by the AO on the basi....