TaxTMI 
TaxTMI 
2020 (1) TMI 1108
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.... 1961 (hereinafter referred to as the "Act") in respect of sale price of plant and machinery amounting to Rs. 1,23,27,565/-. 2. The learned CIT(A) erred in fact and in law in confirming the addition made by the AO to the extent of Rs. 21,61,176/- on the ground that the Appellant has suppressed sales despite the fact that the entire sales were accounted in the books of accounts. 3. Without prejudice to above, the learned AO erred in fact and in law in making addition of gross amount of sales of Rs. 21,61,176/- instead of profit included therein. 4. The learned CIT(A) erred in fact and in law in confirming the action of the AO in charging interest u/s 234B of the Income Tax Act, 1961. 5. The learned CIT(A) erred in fact and in law in confirming the action of the AO in charging interest u/s 234D of the Income Tax Act, 1961 6. The learned CIT(A) erred in fact and in law in confirming the action of the AO in initiating penalty proceedings u/s 271(l)(c) of the Income Tax Act, 1961." 3. The fact in brief is that return of income declaring income of Rs. 7,78,09,540/- was filed on 28th October, 2005. The case was selected for security by issui....
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....price of the sale price of the machinery was quite reasonable. 6. During the course of appellate proceedings before us, ld. counsel has contended that assessing officer was not justified in adopting the written down value of the machinery as arms length price because for the purpose of computing the arms length price there were so many factors which were required to be considered i.e. conditions of machine at the time of sale, useful life of the machine, whether machine was properly maintained by the user, number of year for which the machinery was used etc. The ld. counsel has also submitted that written down value in books cannot be considered as comparable uncontrolled price as the same is the internal price of the machine and not an uncontrolled price. The ld. counsel has also submitted paper book containing various judicial pronouncements on the issue contested in the appeal wherein it is held that arms length price taken on the basis of written down value without identifying any comparable cases is not justified. On the other hand, the ld. departmental representative has supported the order of ld. CIT(A). 7. We have hard both the sides and perused the material on record....
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....." 7.1 We have also gone through the decision of ITAT Delhi in the case of ACIT vs. M/s. Sarens Heavy Lift (I) Pvt. Ltd. vide ITA No.1027/Del/2015 dated 02-04-2018 holding that the written down value of Cranes in the books of associated enterprise of the assessee cannot be considered as arms length price and it is not derived from the transaction between enterprise other than the associated enterprises. Therefore, the Co-ordinate Bench of the ITAT has justified the decision of DRP on the basis of price paid in accordance with the valuation done in the independent chartered engineering or custom authorities or determined under DCF method. We have also gone through the judicial pronouncement in the case of ACIT vs. Koch Chemical Technology Group (India) Ltd. (2015) 64 taxman.com 464 (Mumbai-Trib) wherein it is held that when assessee submitted a report from approved value indicating fair market value of machineries purchased, before rejecting such valuation report, TPO was duty bound to refer valuation of machineries to DVO as per procedure laid down under statute - Moreover, there being no other material brought on record by TPO demonstrating that he made enquiry of any kind to a....
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....factured (iii) Finished goods sold Dry Battery Please mention description and Chapter Sub-heading Finished Good 'A' Quantity (Please specify the unit also) Value (Excluding Taxes) Rs. Opening stock of finished goods 11543566 pcs. (incl. 5405098 pcs of depot) 462.89 (+) Production of finished goods 238338363 pcs.* 10701.58 (-) Closing stock of finished goods 7672224 pcs. (incl. 5557424 pcs.- Of depot.) 329.83 *Finished goods sold at Depot. 241006637 pcs.* 11767.99 * 1. Excludes 1338 PCS. Of Education Centre & (2) 1203068 pcs. Towards sales sales schemes/samples/free replacement damages and shortages during transit (duty paid goods). FINISHED GOODS 242363369 PCS. CLEARNACE ON PAYMENT OF DUTY FROM FACTORY. DATA provided on the base of ANNUAL REPORT as required by dept." 8.5.1. From the copy of excise return submitted by the appellant, it is seen that the production of finished goods has been mentioned at 23,83,38,363 pieces. Against this figure an astrix had been marked and it has been mentioned as a foot note as excludes 1388 pcs. of Education Centre and 1203068 pcs. towa....
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....and noticed that at para 4(ii) production of finished goods was shown at 23,83,38,363 pieces. In the excise return in the summary note, it is stated that 1338 pieces of education center and 12,03,068 pieces of sales schemes were excluded. We have also gone through the cost audit report placed in the paper book from 197 to 287, it is noticed that at page no. 200 of this report the detail of production during the year is given at serial 4 to 6 as under:- Sr. No. Particulars 2004-05 4 Production during the year (a) Self manufactured 1U/1D/1P/1PB 160.29 2U/2P 15.24 3U/15V 63.15 Total 238.67 (b) third party on job work etc. 0 (c) loan license basis 0 5 Total production quantity= (a)+(b)+(c) 238.67 Production as per Excise Records 1U/1D/1P/1PB 160.29 6 2U/2P 15.24 3U 63.15 Total 238.67 The assessee has brought to the notice of the ld. CIT(A) that there was no difference in production as per exc....