Captive consumption valuation: notional profit must be added, and balance-sheet profit may be accepted over higher estimates.

In valuing captively consumed goods, the rule required addition of notional profit to determine assessable value. The lower appellate authority accepted the profit reflected in the balance sheet and profit and loss account, and found no cogent basis for the higher margin adopted by the assessing authority. That approach was upheld on the facts, and the Revenue's challenge to the valuation was rejected.

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Issues: Whether, in valuing goods captively consumed, profit was required to be added on the basis adopted by the lower authority.

Analysis: The valuation rule required addition of notional profit while determining the assessable value of captively consumed goods. The lower appellate authority accepted the profit reflected in the balance sheet and profit and loss account and found no cogent reason for the higher margin adopted by the assessing authority. On the facts, that approach was found to be correct.

Conclusion: The addition of profit as reflected in the balance sheet was upheld and the Revenue's challenge to the valuation was rejected.

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