Advocate Akhilesh Kumar Sah
ACIT Vs Johnson & Johnson Ltd (ITAT Mumbai)
Production loss depends on number of factors and in absence of any comparable to show that loss shown by the assessee is excessive, the contention of the assessee has to be accepted
Recently, in ACIT vs. Johnson & Johnson Ltd. & vice-versa [ITA Nos.1776 & 1777/M/2017 A.Y.s: 2003-04 & 2004-05, decided on 18.06.2018, one of the ground raised by Revenue was that on the facts in the circumstances of the case and in law, the CIT(A) has erred deleting the addition of Rs. 2,67,88,516/- on account of unaccounted production and sale.
At the outset, the Counsel of the assessee submitted before the Bench that the issue was covered in favour of the assessee by the decision of the co-ordinate bench of the Tribunal in assessee’s own case in A.Y. 2002-03. The Counsel further submitted that the appeal filed by the Revenue in A.Y. 2002-03 against the said order of the Tribunal stands dismissed by the Hon’ble Bombay High Court.
The learned Members of the Mumbai ITAT observed that the identical issue has been decided by the co-ordinate bench of the Tribunal in ITA No.4092/M/07 for A.Y. 2002-03 order dated 28.08.2013 wherein it has been held that production loss depends on number of factors and in absence of any comparable to show that loss shown by the assessee is excessive and thus the appeal was decided in favour of the assessee. The said case was decided by the coordinate bench following the order in assessee’s own case for A.Y. 1991-92 in ITA No.1146/M/1997. No evidence of purchases and sales outside the books of accounts were brought before the authorities below in the appeal in question.
The learned Members of the Mumbai ITAT following the order of the co-ordinate bench of the Tribunal in the earlier years, dismissed the ground raised by the Revenue. It was also noted that the Hon’ble Jurisdictional Bombay High Court has not entertained the appeal by the Revenue on this issue by holding that there was no substantial question of law involved.
