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[2009] 309 ITR 335 (UTTARANCHAL) HIGH COURT OF UTTARANCHAL Commissioner of Income-tax v. Nainital Bank Ltd. P.C. VERMA AND DHARAM VEER, JJ. I.T. APPEAL NO. 182 OF 2005 MARCH 23, 2007 S ection 145 of the Income-tax Act, 1961 - Method of Accounting -Valuation of Stock Valuation of securities held by assessee-bank on basis of RBI guidelines was correct [In favour of assessee] CIT v. Nainital Bank Ltd. [2009] 309 ITR 335 (Uttaranchal) Where there had been change in the accounting policies of the assessee-bank with reference to the directives of the RBI in respect of valuation of securities, etc., during the assessment year, the Tribunal was correct in holding that the valuation of investments on the basis of the RBI guidelines was justified; the Assessing Officer was not justified in making addition on the ground that the correct income of the assessee for the assessment year in question could only be computed by adopting the method of accounting as regularly employed by it in earlier years. Arvind Vashisth for the Appellant. S. K. Posti for the R espondent. JUDGMENT This is an appeal against the and order dated February 28, 2005, passed by the Income-tax Appellate Tribunal, (Delhi Bench "B", New Delhi), in I.T.A. No. 91/Delhi/2002. 2. The substantial questions of law raised in the appeal are as follows : "Whether, on the facts and in the circumstances of the case, the hon'ble Income-tax Appellate Tribunal was legally correct in holding that lowering of profit by changing the valuation of investments on the basis of the RBI guidelines was justified without appreciating the fact that the Assessing Officer was duty bound to compute the income in accordance with the provisions of the Income-tax Act ?" "Whether, on the facts and in the circumstances of the case, the hon'ble Income-tax Appellate Tribunal was justified in law in arriving at the conclusion without pronouncing its decision on each grounds of appeal taken before it ?" 3. Brief facts of the case giving rise to the present appeal are that the asses-see is a banking company and the assessment under section 143(3) was completed on November 12, 1999, at a total income of Rs. 1,60,01,450 against returned income…

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