MAHABIR RICE MILL Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) In the present appeal filed under Section 260A of the IT Act, 1961 (hereinafter referred to as the Act), the appellant alleges that five substantial questions of law arise out of the order dt. 4th Dec, 2002, passed by the Tribunal, Allahabad, relating to the asst. yr. 1991-92.

(2.) Briefly stated, the facts giving rise to the present appeal are as follows : The appellant is carrying on business of manufacturing of rice from paddy and its sale. During the course of assessment proceedings for the asst. yr. 1991-92, the AO asked the appellant to intimate the basis of valuation of closing stock. The appellant stated that the valuation of the closing stock has been taken at the cost price. It had valued the common paddy @ Rs. 199.87 per quintal and fine paddy @ Rs. 200 per quintal. The AO directed the appellant to give market rate of fine paddy and common paddy as on 31st March, 1991, whereupon the appellant filed a letter from the Marketing Inspector in which supporting price for purchase of common paddy has been quoted @ Rs. 205 per quintal and fine paddy @ Rs. 215 per quintal. In the reply dt. 14th Dec., 1992, it had also been admitted that sometimes the purchase price to be paid for paddy during the year is more than that fixed by the Government and the rate certified by the Marketing Inspector had been applied for valuation of closing stock for paddy. The AO did not accept the value of the closing stock of common paddy and fine paddy as shown by the appellant. He adopted the valuation of the closing stock at the rates given by the Marketing Inspector, which resulted in an addition of Rs. 7,567 in the closing stock. The addition was upheld by the CIT(A). The further appeal before the Tribunal has also failed.

(3.) We have heard Sri S.D. Singh, learned counsel for the appellant, and Sri Shambhoo Chopra, learned standing counsel for the Revenue.