SHERVANI SUGAR SYNDICATE LTD Vs. INCOME-TAX OFFICER

JUDGEMENT

(1.) The assessee has moved a misc. application against the order of the Tribunal in ITA Nos. 596 (All.) of 1983 and 844 (All.) of 1983.

(2.) The assessee referring to paragraphs 18, 19 and 20 of the order has indicated that the principle of valuation of closing stock as urged by the assessee has been accepted in principal but the Tribunal while giving effect to the said principal has committed an error with reference to the valuation of free sugar. The assessee categorically stated that there is no dispute so far as the valuation of levy sugar is concerned. The assessee in short has indicated that the total stock of free sugar as on the closing date of the previous year was 71,439 qtls. The Tribunal accepted that on the date of signing of the Balance-sheet, i. e., 30-11-1978, the realisation by way of the sale should be taken into consideration and the balance quantity should be valued according to the method followed by the assessee in the earlier year. It has been further indicated referring to page 2 of the paper book that if the earlier method is applied, 42,704 qtls. should be valued @ Rs. 200.40 per qtl. and the balance 28,789 qtls. should be valued @ Rs. 180 which was the prevailing rate as on 30-11-1978. The assessee has stated that the mistake is apparent and glaring and, therefore, the said mistake should be corrected.

(3.) The Senior Departmental Representative very strongly contended that there is no mistake in the order of the Tribunal. The assessee by moving the misc. application intends to review the judgments which is not within the purview of the Tribunals power. The Senior Departmental Representative relied in CIT v. Dr. Krishna Rana,1987 167 ITR 652 and ITO v. ITAT, and T. S. Balaram, ITO v. Volkart Bros., 1971 82 ITR 50 urged that a mistake which is glaring and patent can only be rectified under section 254(2) of the I. T. Act. But a mistake which could be established by long drawn process of reasoning on points on which there may be conceivably two opinions cannot be rectified under this section. He also referred to Padmavati Jaykrishna v. CWT,1976 105 ITR 115. He further referred to the order of the Tribunal and indicated that the assessee valued its stock in the previous year on cost of market rate whichever was lower. During the year under appeal the assessee made a departure and valued the stock after considering the realisable value on the date of signing of the Balance-sheet and further taking the value on 30-11-78, the date of singing of the Balance-sheet though the previous year of the assessee ended on 30-6-1978. The Tribunal accepted in part the argument of the assessee. The Tribunal concluded that the realisable value of the stock on the date of the Balance-sheet may be taken into consideration. However, the Tribunal did not accept that the value prevailing on 30-11-78 should be taken in estimating the unsold stock. The Tribunal has given effect of the principle which was accepted by it and, therefore, there is no mistake in it.