Ita/99/2009 Of Commissioner Of Income Tax, Kottayam v. M/S.william Goodacre Sons (P)Ltd., Alapp

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE P.S.GOPINATHAN TUESDAY, THE 8TH JUNE 2010 / 18TH JYAISTHA 1932 ITA.No. 99 of 2009() -------------------- ITA.319/COCH/2007 of I.T.A.TRIBUNAL,COCHIN BENCH .................... APPELLANT/APPELLANT: ----------------------------- THE COMMISSIONER OF INCOME TAX.KOTTAYAM. BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX RESPONDENT/RESPONDENT: --------------- M/S. WILLIAM GOODACRE AND SONS (INDIA) PVT. LTD., BEACH ROAD, ALAPPUZHA. ADV. SRI.V.RAMACHANDRAN (SR.) ADV. SRI.K.ANAND (A.201) FOR R SMT.LATHA KRISHNAN THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 08/06/2010, THE COURT ON 08/06/2010 DELIVERED THE FOLLOWING: C.N.RAMACHANDRAN NAIR &P.S.GOPINATHAN, JJ.P.S.GOPINATHAN, JJ. ....................................................................I.T. Appeal No.99 of 2009 .................................................................... Dated this the 8th day of June, 2010. JUDGMENT Ramachandran Nair, J. The question raised in the appeal filed by the department iswhether Tribunal was justified in cancelling addition towardsdifference in the opening stock and closing stock amounting to aboveRs.80 lakhs. We have heard Senior Standing Counsel appearing for theappellant and Senior counsel Sri.V.Ramachandran appearing for therespondent. 2. Since the transaction was between the respondent and asubsidiary company of which respondent is a holding company andboth being assessees in the same area, we directed the AssessingOfficer to furnish the details of assessment pertaining to the subsidiarycompany.The Assessing Officer noticed that the difference in closingstock and opening stock of this company for the accounting year 2002- 2003 was above Rs.83 lakhs. However, the report of the AssessingOfficer pertaining to the subsidiary company shows that the difference in stock was treated as closing stock of the subsidiary company. Thisonly means that the respondent has instead of accounting purchase on1st April, 2002, accounted the stock as opening stock. It is seen thatprotective assessment is made on the same stock in the hands of thesubsidiary company. Standing Counsel appearing for the appellantsubmitted that assessee is contesting in appeal the protectiveassessment of the subsidiary company before the Tribunal and theyhave raised a ground pertaining to the closing stock of that year.Counsel appearing for the assessee submitted that ground pertaining tothe opening stock addition of the subsidiary company will not becontested by the assessee in that case. We, therefore, dismiss theappeal on specific condition that the assessee will not press the additionpertaining to the opening stock in the hands of the subsidiary companynamely, M/s.Karinos Weave Private Ltd. However, assessee in that ITA 99/2009 case will be free to challenge the ground pertaining to gross profitaddition. C.N.RAMACHANDRAN NAIRJudge P.S.GOPINATHANJudge pms