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| The Tax Publishers2020 TaxPub(DT) 1185 (Bom-HC) : (2020) 421 ITR 0021 : (2020) 273 TAXMAN 0184 INCOME TAX ACT, 1961
Section 143(3)
Since assessee was consistently following a particular accounting policy from year to year, which was consistent with provisions of section 145A, Tribunal was right in holding that obsolete stock which was not disposed of or sold was allowable as expenditure.
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Assessment - Additions to income - Obsolete stock which was not disposed of or sold whether to be allowed as expenditure -
Assessee claimed losses towards stock obsolescence in respect of laptops and motherboards. AO alleged that laptops and the motherboard which had a long shelf life could not be considered to become obsolete and consequently, disallowed losses in his order passed under section 143(3). Held: There were concurrent findings of fact recorded by the CIT(A) as well as Tribunal that laptops and motherboards were rendered obsolete. There were findings of fact in respect of assessee consistently following a particular accounting policy from year to year, which was consistent with the provisions of section 145A. The Tribunal was right in holding that the obsolete stock which was not disposed of or sold was allowable as expenditure.
Distinguished:CIT v. Heredilla Chemicals Ltd. (1997) 225 ITR 532 (Bom)
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
IN THE BOMBAY HIGH COURT, PANAJI BENCH
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