Manufacturing profit: prior year's margin may be used to determine assessable value under valuation rules when comparables absent. Rule 6(b) offers two valuation methods: comparable goods value and cost of production plus the profit the assessee would have normally earned. Method (ii) is a fallback used when comparables are unavailable and involves a hypothetical, approximate profit. The Board, with the Ministry of Law, endorses using the immediately preceding year's profit margin as a reasonable estimate of the manufacturing profit under method (ii) and finds no need to amend the Valuation Rules to change that instruction.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Manufacturing profit: prior year's margin may be used to determine assessable value under valuation rules when comparables absent.
Rule 6(b) offers two valuation methods: comparable goods value and cost of production plus the profit the assessee would have normally earned. Method (ii) is a fallback used when comparables are unavailable and involves a hypothetical, approximate profit. The Board, with the Ministry of Law, endorses using the immediately preceding year's profit margin as a reasonable estimate of the manufacturing profit under method (ii) and finds no need to amend the Valuation Rules to change that instruction.
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