ITAT allows known Loss on closing stock valuation as per Principle of Prudence

Sanjeev Motwani Vs ACIT (ITAT Mumbai) Introduction: The case of Sanjeev Motwani Vs ACIT (ITAT Mumbai) revolves around the controversial addition of Rs. 10,01,280/- to the income of the assessee, Sanjeev Motwani, pertaining to the valuation of closing stock for the assessment year 2013-14. This article aims to dissect the court’s decision, especially focusing on how the Principle of Prudence was applied to support the assessee’s valuation of closing stock. What Led to the Controversy? Sanjeev Motwani, the proprietor of M/s Jeevat Construction, was engaged in construction contracts w...