PR. COMMISSIONER OF INCOME TAX-1, JODHPUR vs. M/S KANDA EDIBLE OIL PVT. LTD.

ITA/27/2021HC RajasthanRJHC01042574202110 August 2021Author: INDRAJIT MAHANTY,VINIT KUMAR MATHUR2 pages

AI SummaryDismissed

What did the High Court hold?

The High Court agreed with the findings of the Tribunal on questions of fact. The Tribunal had held that the variation in production figures between the DIP file and the stock register was less than 0.5 and was due to estimation methods used for internal purposes, where production was measured in rounded units. The Court also noted that the Assessing Officer's addition was based on electricity consumption during August 2014, when consumption was lowest. Relying on its own decision in CIT Vs. Sulabh Marbles Pvt. Ltd. (165 Taxman 258), the Court found that the Assessing Officer had erred in making additions based on electricity consumption by assuming higher actual production than disclosed. Consequently, the High Court found no justiciable ground to entertain the appeal.

What were the facts?

The appellant, Pr. Commissioner of Income Tax-1, Jodhpur (Revenue), filed an appeal against the order dated 01.02.2021 passed by the Income Tax Appellate Tribunal (ITAT), Jodhpur Bench. The ITAT's order disposed of ITA No.191/JODH/2019 and C.O. No.17/JODH/2019, which involved an appeal by the Revenue and a cross-objection by the assessee, M/s Kanda Edible Oil Pvt. Ltd. The Revenue's primary contention before the High Court was that the ITAT erred in its findings regarding the suppression of production or sales outside the books of accounts. The ITAT had attributed minor variations in production figures to estimation methods used for internal purposes.

What were the issues?

1. Whether the Tribunal erred in holding that the variation in production figures between the DIP file and stock register, which was less than 0.5 due to estimation, did not indicate suppression of production or sales outside the books of accounts? (Question of fact) Contentions: Assessee: The variation in production was minor and attributable to the estimation method used for internal purposes, where the DIP register measured production in rounded units. A small difference in measurement could lead to such minor variations. Revenue: The Tribunal erred in its findings regarding the suppression of production or sales outside the books of accounts, as indicated by the variation in production figures.

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Income Tax Appeal No. 27/2021 Pr. Commissioner Of Income Tax-1, Jodhpur, District Jodhpur ----Appellant Versus M/s Kanda Edible Oil Pvt. Ltd., E 173, Udyog Vihar, Sriganganagar ----Respondent For Appellant(s) : Mr. K.K. Bissa. For Respondent(s) : HON'BLE THE CHIEF JUSTICE MR. INDRAJIT MAHANTY HON'BLE MR. JUSTICE VINIT KUMAR MATHUR

Order 10/08/2021 Heard learned counsel for the appellant-Income Tax Department.

The appeal has been sought to be filed by the appellant against the order dated 01.02.2021 passed by the Income Tax Appellate Tribunal, Jodhpur Bench, Jodhpur in ITA No.191/JODH/2019 and C.O. No.17/JODH/2019. On perusal of the impugned order passed by the Tribunal, it appears that the Department has gone in appeal before the Tribunal and the assessee has filed cross objection in that appeal and the same came to be disposed of by the Tribunal by a common order dated 01.02.2021. Learned counsel for the Revenue drew our attention to para- 14 of impugned order and essentially contended that there has been suppression of production or sales outside the books of accounts. The Tribunal has come to the finding that the variation

(2 of 2) [ITA-27/2021] Ashutosh-10

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