CHANDRA BROS.,KOLKATA vs. I.T.O., WARD - 37(1), KOLKATA, KOLKATA

ITA 1572/KOL/2024Status: DisposedITAT Kolkata22 July 2025AY 2022-2023Bench: SRI PRADIP KUMAR CHOUBEY, JUDICIAL MEMBER & SRI RAKESH MISHRA (Accountant Member)18 pages
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What did the Tribunal hold?

The Tribunal held that while LIFO is not an approved method under ICDS-II, both opening and closing stock must be valued using the same methodology. The AO was directed to recompute the profit by following ICDS-II and consider past years for the accumulated impact, potentially through reassessment proceedings.

What were the facts?

The assessee, engaged in the business of gold and silver ornaments, had its income enhanced due to an addition of Rs. 1,14,67,009/- on account of undervaluation of closing stock. This addition was made based on the Tax Audit Report citing non-compliance with ICDS-II.

What were the issues?

Whether the addition for undervaluation of closing stock was correctly made, and if the consistent valuation method for opening and closing stock should be applied as per ICDS-II.

Which sections of the Income-tax Act were involved?

Section 143(1),Section 145(2),Section 145A,Section 148

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Income Tax Appellate Tribunal, KOLKATA ‘B’ BENCH, KOLKATA

Before: SRI PRADIP KUMAR CHOUBEY & SRI RAKESH MISHRA

PER RAKESH MISHRA, ACCOUNTANT MEMBER:

This appeal filed by the assessee is against the order of the Addl/JCIT(A)-3, Chennai [hereinafter referred to as Ld. ‘Addl/JCIT(A)'] passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for AY 2022-23 dated 27.05.2024, which has been passed against the intimation order u/s 143(1) of the Act, dated 15.06.2023. 2. The assessee is in appeal before the Tribunal raising the following grounds of appeal: I.T.A. No.: 1572/KOL/2024 Assessment Year: 2022-23 Chandra Bros. “1. That on the facts and circumst

The order continues below.

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