In Brief
A partnership firm engaged in ship materials scrap trading was dissolved upon the death of one partner in 1993, but the surviving partner continued the business and inherited the deceased partner's share. The assessee valued closing stock at cost price. The Income Tax Officer accepted this valuation, but the CIT exercised revisionary jurisdiction under Section 263, ordering revaluation at market price based on a Supreme Court decision. The High Court upheld the assessee's challenge, holding that market valuation applies only when a dissolved firm's business entirely ceases. Here, since the business continued, cost-based valuation was plausible and permissible. The Supreme Court affirmed, holding the CIT could not invoke Section 263 where two views were possible in law.</summary_100> </invoke>
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