Commissioner Of Income-Tax vs Shri Panchganga S.S.K. Ltd.
2001 Latest Caselaw 903 Bom

JUDGMENT

1. Heard parties.

Admit.

Shri Vaidya for the respondent waives service.

By consent of parties, appeal be taken up for final hearing.

The three questions sought to be raised in this appeal have already been covered and answered by two different judgments of this court. The substantial questions of law raised are as under :

"(1) Whether, on the facts and in the circumstances of the case, and in law, the Tribunal relying upon the decision of the Special Bench in the case of Shri Chatrapati Sahakari Sakhar Karkhana Ltd. v. Deputy CIT [1992] 198 ITR (A.T.) 78 (Pune), was right in deleting the additions made by the Assessing Officer on account of non-refundable deposits, interest paid/payable on non-refundable deposits by holding that various funds/deposits collected by the assessee-society out of sugarcane purchase price payable to the cane growers are not the trading receipts of the assessee ?

(2) Whether, on the facts and in the circumstances of the case and in law, the Tribunal was justified in deleting the disallowance of payment of excess price of cane sugar at Rs. 2,50,50,825 for the assessment year under consideration without appreciating the facts that as per the bye-law No. 64 the cane sugar price payable to the members of the society, are decided by the board of directors for respective season taking into consideration the circumstances and the financial business during the year and according to the constitution and aims and bye-laws of the society, so long as the society has not redeemed the share capital contributed by the Government or has not fully repaid the loans from the Industrial Finance Corporation or Central Finance Agency on block capital account, the State Government shall fix the rate of return on cane supplied by the members of the society ?

(3) Whether, on the facts and in the circumstances of the case and in law, the Tribunal is right in deleting the disallowance of Rs. 1,80,359 out of advertisement expenses on account of subhechcha greetings holding that expenditure was necessary to maintain cordial relations with the members and ignoring that the expenses were not to advertise the product of the assessee and such expenses are not required considering the product of the assessee ?"

2. Question No. 1 has been answered and covered by the judgments of this court in the case of CIT v. Chhatrapati Sahakari Sakhar Karkhana Ltd, [2000] 245 ITR 498 ; CIT v. Shree Panchaganga Sahakari Sakhar Karkhana Ltd, [2001] 250 ITR 772 in favour of the Revenue and against the assessee.

3. Questions Nos. 2 and 3 have been covered and answered in favour of the assessee and against the Revenue in the case of Shree Panchaganga Sahakari Sakhar Karkhana Ltd. [2001] 250 ITR 772 (Bom).

4. Accordingly, question No. 1 is answered in favour of the Revenue and against the assessee, whereas questions Nos. 2 and 3 are answered in favour of the assessee and against the Revenue.

5. In this view of the motion, the appeal is allowed partly so far as question No. 1 is concerned. With respect to questions Nos. 2 and 3, the appeal stands dismissed with no order as to costs.