TaxTMI 
TaxTMI 
2026 (8) TMI 1667
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....(hereinafter referred to as "the Tribunal") in ITA No.172/Jodh/2018 for the Assessment Year 2014-15, whereby the Tribunal allowed the appeal preferred by the respondent-assessee and deleted the additions/disallowances made by the Assessing Officer and sustained by the Commissioner of Income Tax (Appeals). 2. The appeal was admitted by this Hon'ble Court vide order dated 07.01.2020 on the following two substantial questions of law: "1. Whether the ld. ITAT was justified in deleting the addition of Rs.7,95,50,000/- by completely ignoring the facts brought on record by the AO regarding evasion of tax by the assessee by suppressing the profits earned from sale of shares by showing fictitious loss from trading of commodities where th....
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....porting material and other circumstances surrounding the transaction. 2.4. The respondent-assessee had shown the aforesaid quantity of Guar as closing stock as on 31.03.2013. The Assessing Officer, however, doubted the valuation of the corresponding opening stock as on 01.04.2013 and recomputed the value by adopting the prevailing market rate, resulting in an addition of Rs.7,95,50,000/-. 2.5. The Assessing Officer also disallowed the interest claimed by the respondent-assessee on the outstanding credit in the account of M/s Ganganagar Guar Gum Pvt. Ltd. 2.6. The Commissioner of Income Tax (Appeals), vide order dated 10.01.2018, upheld the assessment order. Aggrieved thereof, the respondent-assessee preferred an appeal before the T....
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....[Civil Appeal No.1793 of 1970, decided on 04.03.1975, reported as (1975) 99 ITR 135 (SC)], wherein the Hon'ble Supreme Court observed in paragraph 10: "10. The observations of this Court, quoted above, fully apply to the facts of the case in hand. It will bear repetition that the closing stock for the asst. yr. 1959-60, as entered in the books of the assessee, was Rs. 5,89,439, and as found by the ITO was Rs. 8,04,121. Since the closing stock of one assessment year furnishes the figure of the opening stock for the succeeding year, it follows that the record showing the closing stock of one asst. yr. 1959-60 formed a part of the evidence relevant to the assessment for the asst. yr. 1960-61. Thus, to the extent of ascertaining the cl....
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....23/2003, decided on 02.05.2017), by a Co-ordinate Bench of this Hon'ble Court, wherein, while dealing with questions relating to valuation of closing stock, this Court observed: "The question No.3 related to disallowance on account of change in valuation of closing stock. This issue too has already been settled by the Apex Court in the judgment reported in 318 ITR (SC) 204 and 99 ITR (SC) 135, holding therein that closing stock becomes the opening stock of the next year and as such the Income Tax Appellate Tribunal was justified to adjust the alleged loss of Rs.78,43,000/- by excluding the interest on government loan and office expenses from the cost of closing stock. The question No.4 pertains to valuation of closing stoc....
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....ng stock of the earlier year forms the opening stock of the next accounting year. In Mahendra Mills Ltd. v. P.B. Desai, Appellate Assistant Commissioner of Income Tax & Anr.,(Supra), the Hon'ble Supreme Court has further explained the interrelationship between the two assessment years and held that, to the extent of ascertaining the closing and opening stock positions, the two assessments "telescoped into each other". 6. The aforesaid principle has also been recognised by this Court in Commissioner of Income Tax, Udaipur (Supra), wherein this Court specifically observed that the issue concerning valuation of closing stock "has already been settled by the Apex Court" and reiterated that the closing stock becomes the opening stock of the n....