COMMISSIONER OF INCOME TAX Vs. NATHULAL JAWARCHAND

JUDGEMENT

(1.) AT the instance of the applicant-assessee, the Income-tax Appellate Tribunal, Indore Bench, Indore, has under Section 256(1) of the Income-tax Act, 1961 (for short "the Act"), stated the case and referred the undernoted questions said to be of law to this court, arising out of its order dated May 26, 1992 in I. T. A, No. 773/Ind, of 1986 :

(2.) THE assessee was a registered firm. THE relevant year of assessment is 1984-85, the previous year ending Diwali, 1983. This was the last year of the firm since the firm was dissolved, vide deed of dissolution dated November 4, 1983.

(3.) THE assessee filed a written reply dated August 24, 1986, before the Commissioner of Income-tax. In the said reply, it was stated that the method of valuation of closing stock of silver was cost price and the same method had been followed by the assessee for the last many years. It was also stated that the assessee had filed the closing stock inventory of silver ornaments before the Income-tax Officer at the time of the assessment in which the assessee had shown the year-wise purchases of silver ornaments remaining in stock. It was also contended that the value of closing stock shown by the assessee was more than the purchase price of stock in hand and as such there was no undervaluation of closing stock.