Valuation of closing stock
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
29 January 2015
Dear Experts,
One of my client valued stock at market price which is greater then cost. for example cost is 40 lacs and market price is 50 lacs. and the same stock is sold for Rs. 50 lacs in next year.
does it will results any direct tax or indirect tax evasion
Please answer on urgent basis
One of my client valued stock at market price which is greater then cost. for example cost is 40 lacs and market price is 50 lacs. and the same stock is sold for Rs. 50 lacs in next year.
does it will results any direct tax or indirect tax evasion
Please answer on urgent basis
29 January 2015
no, it is against Accounting standard 2 valuation of inventory and should be valued at 40 lacs only
Rupesh Jain
(Expert)
29 January 2015
you can not make valuation on market price.
you have to pay vat on sales value.
you have to pay vat on sales value.
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