The Commissioner Of Income-Tax v. M/S. Golden Chemicals Pvt.ltd

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION Income Tax Appeal NO. 847 of 2000 The Commissioner of Income-tax .... Appellant. vs. M/s. Golden Chemicals Pvt.Ltd. .. ... . ... Respondents A. K. Kotangale for Appellant F. V. Irani i/b. A. K. Jayani for Respondents. CORAM:S. RADHAKRISHNAN ANDA. S. AGUIAR JJ. Date: 7/6/2005 ORAL JUDGMENT (Per S.Radhakrishnan J.) 1.Respondents. Perused the assessment order. Heard learned counsel for the Appellant and the 2.By this appeal the appellant is seeking to raise the followingquestion of law: “Whether, the Tribunal is justified in dismissingthe appeal of the department against the orderdated 26/2/1992 of the CIT (A), wherein it washeld that the addition of Rs.15,47,418/- on account of change in the method of valuation ofclosing stock should not be considered for thepurpose of determining book profit whilecomputing the tax liability of the assessee u/s.151J of the Income-tax Act 1961?” 3.We have also perused the original Assessment Order dated30.1.1991 wherein in para 10 that the Respondent had changed thebasis of valuation of the closing stock of finished goods to “Cost ormarket value whichever is lesser” as compared to “Market Value” inthe previous year. Learned counsel for the Respondent very fairlystated that the Respondent is entitled to make bona fide change in themethod of valuation of the closing stock. There is no finding that theRespondent had maintained the account contrary to the provisions ofthe Companies Act. Therefore learned counsel for the RespondentMr. Irani brought to our notice the recent judgment of the SupremeCourt in Apollo Tyres Ltd. Vs. Commissioner of Income-tax, 2002 (255)ITR 27, wherein the Supreme Court has observed as under: “While so looking into the accounts of thecompany, an Assessing Officer under the Income-tax Act has to accept the authenticity of theaccounts with reference to the provisions of the Companies Act which obligates the company tomaintain its account in a manner provided by thestatutory auditors and will have to be approved bythe company in its general meeting and thereafterto be filed before the Registrar of Companies whohas a statutory obligation also to examine andsatisfy that the accounts of the company aremaintained in accordance with the requirementsof the Companies Act.” 4.Under the aforesaid facts and circumstances, especially inview of the judgment of the Supreme Court in Apollo Tyres (supra) wefind no substantial question of law involved in this appeal. Appeal dismissed. S. RADHAKRISHNAN A. S. AGUIAR