Itxa/3450/2010 Of The Commissioner Of Income Tax -Iv Pune v. Chandrabhaga Sahakari Sakharkarkhan Altd

sas IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.3450 OF 2010 The Commissioner of Income Tax-IV ..Appellant. V/s. Chandrabhaga Sahakari Sakhar Karkhana Ltd. ..Respondent. Mr. Vimal Gupta for the appellant. Mr. Mihir Naniwadekar for the respondent. CORAM : J.P. DEVADHAR AND SMT. R.P.SONDURBALDOTA JJ. DATED : 29TH JUNE, 2011 P.C. :- 1.Six questions of law are raised by the revenue in this appeal which read thus:- A.Whether on the facts and in the circumstances of the case, the ITAT was justified in deleting the addition made by the assessing officer in respect of excess cane price paid by the Co-operative Society in excess of CMP (common minimum price) fixed by both Central Government and State Government after the finalization of the financial results ?ITAT was justified in deleting the addition made by the assessing officer in respect of excess cane price paid by the Co-operative Society in excess of CMP (common minimum price) fixed by both Central Government and State Government after the finalization of the financial results ? B.Whether on the facts and in the circumstances of the case, the ITAT was justified in confirming the decision of the ITAT in holding that the provisions of Section 40A(2) are not applicable in the case ITAT was justified in confirming the decision of the ITAT in holding that the provisions of Section 40A(2) are not applicable in the case of Co-operative Society in respect of payments made to both members and non members for the purchase of cane in excess of the statutory price fixed. The provisions of Section 40A (2) are in relation to unreasonable and excess payments made by the assessee. Therefore, the provisions are applicable in the case of the assessee ? C.Whether on the facts and in the circumstances of the case, the ITAT was justified in deleting the addition made by A.O. u/s.37(1) being excess cane price paid to members and non members of the society in excess of permission as per clause 3(1) of sugar control order 1966 of Central Government ?ITAT was justified in deleting the addition made by A.O. u/s.37(1) being excess cane price paid to members and non members of the society in excess of permission as per clause 3(1) of sugar control order 1966 of Central Government ? D.Whether on the facts and in the circumstances of the case, the ITAT was justified in confirming the action of CIT(A) in deleting the addition made on account of excess cane price paid to members as well as non members ?ITAT was justified in confirming the action of CIT(A) in deleting the addition made on account of excess cane price paid to members as well as non members ? E.Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in holding that the payments made by the Co-op Society were not excessive and unreasonable within the meaning of section 40A(2) of the Act. In respect to members and that to non members within the meaning of Section 37(1) of the Act ?law, the Tribunal was justified in holding that the payments made by the Co-op Society were not excessive and unreasonable within the meaning of section 40A(2) of the Act. In respect to members and that to non members within the meaning of Section 37(1) of the Act ? F.Whether on the facts and in the circumstances of the case and in law, the additional amount paid by the society after finalization of the financial accounts for the year under consideration can be considered to be appropriation of net profit and price paid by the Society for the procurement of the sugar cane is to be allowed as a business expenditure ?law, the additional amount paid by the society after finalization of the financial accounts for the year under consideration can be considered to be appropriation of net profit and price paid by the Society for the procurement of the sugar cane is to be allowed as a business expenditure ? F.Whether on the facts and in the circumstances of the case and in law, the additional amount paid by the society after finalization of the financial accounts for the year under consideration can be considered to be appropriation of net profit and price paid by the Society for the procurement of the sugar cane is to be allowed as a business expenditure ?law, the additional amount paid by the society after finalization of the financial accounts for the year under consideration can be considered to be appropriation of net profit and price paid by the Society for the procurement of the sugar cane is to be allowed as a business expenditure ? 2.Counsel for the parties state that similar questions raised by the revenue in the case of The Commissioner of Income Tax-III, Pune V/s. Kisanveer Satara SSK Ltd. [Income Tax Appeal no.3321 of 2010] decided on 24/6/2011 has been restored back to the file of CIT(A) for fresh decision in the light of the judgment of the Apex Court in the case of Dy. Commissioner of Income-tax, Nashik V/s. Shri Satpuda Tapi 3 itxa3450-10 Parisar SSK Ltd. reported in (2010) 189 Taxman 81 (SC). Accordingly, the matter is restored to the file of CIT(A) for fresh consideration in the light of the aforesaid decision of the Apex Court. 3.The appeal is disposed off accordingly with no order as to costs. (SMT. R.P.SONDURBALDOTA, J.) (J.P. DEVADHAR, J.)