The Commissioner Of Income Taxversussant Eknath Sahakari Sakhar Karkhana Ltd v. Ghuge, Jj.dated: January 27, 2014

IN THE HIGH COURT OF JUDICATURE OF BOMBAYBENCH AT AURANGABAD TAX APPEAL NO. 56 OF 2011 THE COMMISSIONER OF INCOME TAXVERSUSSANT EKNATH SAHAKARI SAKHAR KARKHANA LTD.... ASG for Appellant : Shri Alok SharmaAdvocate for Respondents : Shri D.R.Kale Patil... CORAM : S.C.DHARMADHIKARI & RAVINDRA V. GHUGE, JJ.Dated: January 27, 2014 ... PER COURT :- 1.One of the issues raised in this Tax Appeal is identical to the Tax Appeal No.33 of 2009 decided by us today, and other appeals, on applicability of Section 40-A(2) of the Income Tax Act, 1961. 2.For the reason that has persuaded us to remand the appeal to the Commissioner of Income Tax (Appeals), following the Supreme Court order, we also direct similar remand in this case. The same substantial question of law as framed in the order passed today in relation to Section 48(2) of the Income Tax Act, 1961 arises in this case. 3.In so far as contribution to Vasantdada Sugar Institute is concerned, we have in several matters decided that as far as that issue is concerned, the Income Tax Tribunal ought to have rendered a complete finding and in terms of the legal provisions. If the amount has been paid or contribution has been made to the institution to be used for scientific research then that ought to have been indicated with sufficient clarity and proper details. In the present case, the Income Tax Appellate Tribunal has not discussed any factual aspects but merely followed the judgment and order rendered in the case of Panchaganga Sahkari Sakhar Karkhana Ltd. in ITA No.491 and 1365/PN/1991 for A.Y. 1989-90 and 1984-85, decided on 20.7.1994. Without referring to the details of the contribution made, the Tribunal could not have granted the expenditure as a deduction permissible in terms of the statute. Therefore, a substantial question of law as framed by us, herein below, would arise for determination and consideration:- " Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in deleting the addition made by the Assessing Officer in respect of the contribution made by the assessee for the Vasant Dada Sugar Institute, whereas there are facts on record that: (i)the amount paid by the assessee is in the nature of the contribution / donation and the same can be allowed under Section 35(1) of the IT Act when it is actually paid; (ii)the amount paid by the assessee is not the liability of the assessee, as there are no evidences on record to this effect; and (iii)even if for the sake of argument, it is considered that this is the liability of the assessee, the assessee has not produced any evidence to establish that this liability has actually been incurred / paid by the assessee? " 4.Therefore, for both issues, it is necessary to remit the matter back to the Commissioner of Income Tax (Appeals), Aurangabad. The impugned orders are therefore, quashed and set aside. The appeal is restored to file of Commissioner of Income Tax (Appeals), Aurangabad for deciding it afresh on merits and in accordance with law, as expeditiously as possible. There will be no order as to costs. ( RAVINDRA V. GHUGE, J. ) ( S.C.DHARMADHIKARI, J. ) ... akl