SPECIALITY PAPERS LIMITED,MUMBAI vs. DEPUTY COMMISSIONER OF INCOME TAX 4(3)(1), MUMBAI

1 On the fa learned CIT(A disallowance the alleged gr the requisite submitted and 1.2 The learn method of inv accounting, i Institute of C accepted by la AS-2 is allowa 1.3 Without p appreciated t respect to clo immediate su increase Grou of cash depos 2.1 On the fa learned CIT(A making addit pertaining to has duly disc out of sales m unexplained m 2.2 The CIT(A provisions of violation of c books of ac explanation in money in boo is not applica Act is liable to 2.3 The CIT(A sales are reco account and making addit received and in the han liable to be ITA acts and in circumstances of the case an A) erred in upholding the action of the l of expenditure on account of change in round of lack of satisfactory justification details pertaining to the inventory valua d thus, the entire disallowance ought to b ned CIT(A) failed to appreciate and ough ventory valuation was based on settled i.e. Accounting Standard - 2 ('AS-2') is Chartered Accountants of India ('ICAI') aw and thus, any change in inventory va able as business expenditure. prejudice to the above, the learned CIT(A) that if the disallowance made by the lea osing stock value is upheld then the ope ubsequent year, i.e. AY 2018-19 will und No. 2 – Addition u/s, 69A rws 115B sits made out of earlier year sales: Rs. 12 acts and in circumstances of the case an A) erred in upholding the action of the l tion of cash deposited during demonet the sales made in earlier years inasmuch charged its onus to prove that the cash d made in earlier years and thus, the enti made on surmises and conjectures ought (A) failed to appreciate and ought to h f section 69A of the Act could be invok cumulative conditions, viz. failure to rec ccounts and offer no explanation/ u nasmuch as since the fact that appellant ks of accounts, the provisions of section able and entire unlawful addition made u o be deleted; A) failed to appreciate and ought to have h ognized in a particular year as per the au offered to tax in respective year then tion of the said sales again in the year in deposited in bank account amounts to d nds of appellant which is legally deleted. Speciality Papers Ltd 2 A No. 4917/MUM/2025 nd in law, the learned AO in inventories on n inasmuch all ation was duly be deleted; ht to have that d principles of ssued by the and is duly aluation as per ought to have arned AO with ening stock of consequently BBE of the Act 2,88,221/- nd in law, the learned AO in tization period h as appellant deposited were ire addition of to be deleted; ave held that ked in case of cord money in unsatisfactory t has recorded 69A of the Act u/s. 69A of the held that once udited books of the action of which cash is ouble taxation invalid and 2. Despite due ser assessee at the time adjournment placed o 3. The learned Dep notice that another order of the learned C been registered as I that the said appeal w request of the asses learned DR submitte appeal against the adjudication. 4. Having consider we are of the view th ITA No. 4897/Mum rendered infructuous 5. In the result, th Order pronoun (RAJ KUMAR C JUDICIAL M Mumbai; Dated: 22/09/2025 Rahul Sharma, Sr. P.S.