ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE - 2, KOLHAPUR vs. ECO CANE SUGAR ENERGY LTD, KOLHAPUR

Briefly stated, the facts of the case are that the assessee’s appeal (ITA No.2982/PUN/2017) came up for consideration before the Tribunal on 08-11-2018 against the confirmation of disallowance of Rs.1,21,56,000/- out of the total addition made by the Assessing Officer (AO) to the extent of Rs.12,16,96,081/-. The ld. DR was directed to confirm if the Revenue had also filed any cross appeal against the order passed by the ld. CIT(A). In such proceedings, the ld. DR did not point out the factum of the Revenue having filed any cross appeal against the impugned order, which fact has been recorded at para 5 of the Tribunal order dated 08-11-2018 in ITA No.2982/PUN/2017. The Tribunal dealt with the issue in the assessee’s appeal and deleted the addition partly sustained in the first appeal to the tune of Rs.1,21,56,000/-. Now the Revenue has filed the instant Miscellaneous Application contending that the Revenue had in fact preferred appeal before the Tribunal and hence rectification is warranted.

I have heard both the sides and perused the relevant material on record. The assessee is a Public Limited Company engaged in the business of production of White crystal sugar.

On an overview, the Revenue is now against the deletion of addition and through the MA it has been urged that the relief allowed to the assessee be recalled. It is seen that the total amount of disallowance made by the AO was at Rs.12.16 crore, being, the amount of H&T expenses claimed by the assessee. While disposing of the assessee’s appeal, the Tribunal held that the entire amount of Rs.1800/- per MT was separately paid by the assessee for purchase of sugarcane, which was eligible for deduction in full and there was no reason for making any separate addition on account of H&T expenses, which was again a separate payment made to H&T contractors, having no direct link with the payment made to the farmers covered by the purchase price. As the Tribunal in the appeal of the assessee has observed that the payment made by the assessee at Rs.1800/- per MT in addition to the payment of H&T expenses was genuine and there was no reason for sustaining even part disallowance, I am of the considered opinion that there is no merit in the appeal of the Revenue through which the order of the ld. CIT(A) deleting the above part addition has been assailed. I, therefore, uphold the .

Having already reversed the order of the ld. CIT(A) to the extent it was partly against the assessee, the remaining part of the deletion of disallowance by him representing the grievance of the Revenue in the appeal under consideration, is consequential and cannot be accepted.

In the result, both the appeal as well as the Miscellaneous Application stand dismissed.