Cit vs Mahalakshmi Mills Co. Ltd.
2006 Latest Caselaw 1349 Del

Citation : 2006 Latest Caselaw 1349 Del
Judgement Date : 18 August, 2006

Delhi High Court

Cit vs Mahalakshmi Mills Co. Ltd. on 18 August, 2006

Bench: M B Lokur, V Sanghi

ORDER

1. The revenue is aggrieved by an order dated 24-10-2005 passed by the Income Tax Appellate Tribunal, New Delhi Bench 'B' in ITA Nos. 3238-3241(Delhi)/2001 relevant for the assessment years 1993-94, 1994-95, 1996-97 and 1997-98.

2. The issue that has arisen is with regard to the taxability of the amount transferred by the assessed to the Molasses Storage Reserve Fund. The assessed had claimed the transfer as a deduction from income but this is not allowed by the assessing officer. However, the assessed succeeded before the Commissioner (Appeals) as well as before the Tribunal.

3. The Tribunal has noted that in the assessed's own case for the year 1990-91, the Tribunal had taken a decision in favor of the assessed and learned counsel for the revenue states that the orders passed for the assessment year 1990-91 is under challenge in this Court.

4. However, we find that the issue in this case is covered by a Division Bench decision of this court in the case of DCM Ltd. v. CIT (2005) 145 Taxman 124. This was apparently conceded by the senior departmental representative appearing before the Tribunal also.

5. In addition, the Madras High Court in CIT v. New Horizon Sugar Mills (P.) Ltd. held that the amount set apart for the purposes of the Molasses Storage Reserve Fund should be excluded from the total income of the assessed. The revenue filed a civil appeal before the Supreme Court challenging the order of the Madras High Court and in CIT v. New Horizon Sugar Mills (P.) Ltd. (2004) 269 ITR 397, the Supreme Court rejected the civil appeal in view of an earlier order rendered by the Supreme Court dated 28-8-2001 in the case of CIT v. Ambur Co-operative Sugar Mills Ltd. (2004) 269 ITR 398.

6. From a reading of the order passed in Ambur Co-operative Sugar Mills' case (supra), it appears that various High Courts have taken the same view as the decision of this court in DCM Ltd's case (supra) and the Madras High Court in the case of New Horizon Sugar Mills (P.) Ltd. (supra). In view of this, we find that no substantial questions of law arise for the consideration.

7. The appeal is dismissed.