2024 (12) TMI 1688

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....ssment passed u/s 143(3) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') dated 20.01.2018 by the Assessing Officer, Addl. CIT, Special Range-6, New Delhi (hereinafter referred to as 'ld. AO'). 2. Though the assessee has raised several grounds, the only effective issue to be decided in this appeal is as to whether the ld NFAC was justified in confirming the disallowance made on account of provision for warranty in the facts and circumstances of the instant case. 3. We have heard the rival submissions and perused the material available on record. The return of income for AY 2014-15 was filed electronically on 28.11.2014 declaring total income of Rs. 93,64,12,844/-. The assessee is engaged in the business of manufactur....

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....to 0.5% of the sales (net of excise duty) made, which are still covered under the warranty period of two years. This percentage of 0.5% of the sales (net of excise duty) for the two years covered under the warranty is determined by the assessee on the scientific basis considering the risk involved in manufacturing and sale of ECUs. The assessee also submitted the rationale for maintaining the provision for warranty @0.5% net sales of the two years by duly considering and explaining the risk of components use; designing risk; critical manufacturing process; shorting / campaigning risk or penalty. The assessee also placed reliance on the decision of the Hon'ble Supreme Court in the case of Rotork Controls India (P) Ltd Vs. CIT (2009) 180 ....

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....5,744 9,70,475 2,11,89,743 6% 2013-14 3,15,04,48,838 5,43,03,60,710 2,71,51,804 2,11,89,743 63,44,240 4,81,046 2,70,52,937 2% 2014-15 3,00,42,85,352 6,15,47,34,190 3,07,73,671 2,70,52,937 61,17,343 24,13,116 3,07,57,164 9% 2015-16 4,49,32,08,473 7,49,74,93,825 3,74,87,469 3,07,57,164 1,21,10,880 53,80,575 3,74,87,469 17% 2016-17 5,61,67,84,566 10,10,99,93,039 5,05,49,965 3,74,87,469 2,23,53,072 66,25,612 5,32,14,929 18% 2017-18 6,29,96,36,237 11,91,64,20,803 5,95,82,104 5,32,14,929....