THE COMMISSIONER OF INCOME TAX AURNGABAD vs. MANJARA SAHAKARI SAKHAR KARKHANA LTD.

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TA/1/2009HC BombayHCBM03031583200810 February 2012Author: HON'BLE SHRI JUSTICE S.B.DESHMUKH,HON'BLE SHRI JUSTICE D. G. KARNIK2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the issue involved in the present case was identical to the one decided by the Supreme Court in Deputy Commissioner of Income-Tax Vs. Shri Satpuda Tapi Prarisar SSK Ltd. and others [(2010) 231 CTS (SC) 224]. In that Supreme Court case, the matter had been remanded to the Commissioner of Income Tax (Appeals) for a fresh decision in light of directions issued by the Supreme Court. Therefore, the High Court found that a remand order would be appropriate in the present appeal. The impugned order of the Tribunal was set aside, and the matter was remanded back to the Commissioner of Income Tax (Appeals) for deciding it afresh in light of the Supreme Court's decision in the cited case. No specific finding was given on the merits of the disallowance itself, as the matter was remitted for fresh adjudication.

What were the facts?

The Revenue, represented by the Commissioner of Income Tax, Aurangabad, filed an appeal before the Bombay High Court at Aurangabad against an order passed by the Income Tax Appellate Tribunal (ITAT). The appeal concerned assessment year(s) not specified in the judgment. The dispute revolved around the deletion of a disallowance made by the Assessing Officer (AO) under Sections 40A(2) and 37(1) of the Income Tax Act, 1961. This disallowance was on account of excessive sugarcane price paid by the assessee, Manjara Sahakari Sakhar Karkhana Ltd., a co-operative society, to its members and non-members. The High Court heard the appeal at the admission stage by consent of the parties.

What were the issues?

1. Whether, on the facts and circumstances of the case and in law, the Tribunal was justified in deleting the disallowance made by the Assessing Officer under Section 40A(2) and 37(1) of the Income Tax Act, 1961, on account of excessive payment of sugarcane price to its members and non-members by the assessee (a co-operative society)? Assessee's contentions: The judgment does not record any specific contentions made by the assessee. The assessee is represented by Shri N.D. Sonawane h/f Shri V. D. Hon. Revenue's contentions: The Revenue, represented by Shri Alok Sharma, pressed the sole issue as framed above. The Revenue relied on the fact that the issue was identical to one decided by the Supreme Court in the case of Deputy Commissioner of Income-Tax Vs. Shri Satpuda Tapi Prarisar SSK Ltd. and others [(2010) 231 CTS (SC) 224], where the matter was remanded.

Which sections of the Income-tax Act were involved?

Section 40A(2),Section 37(1)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT AURANGABAD TAX APPEAL NO. 1 OF 2009 THE COMMISSIONER OF INCOME TAX AURNGABAD VERSUS MANJARA SAHAKARI SAKHAR KARKHANA LTD. ASG for Appellant : Shri Alok Sharma Advocate for Respondent : Shri N.D.Sonawane h/f Shri V. D. Hon CORAM : D. G. KARNIK & S. B. DESHMUKH, JJ. Dated: February 10, 2012 PER COURT :- 1. Heard respective counsel. 2. By consent, the appeal is taken up for final hearing at the stage of admission. 3. The only issue which is pressed on behalf of the Revenue in this appeal is:- “ Whether on the facts and circumstances of the case and in law, the Tribunal was justified in deleting the dis-allowance made by the Assessing Officer under Section 40A(2) and 37(1) of the Income Tax Act, 1961 on account of excessive payment of the sugarcane price paid to it's members and non-members by the assessee ( a co-operative society) ?” 4. Learned counsel for the parties are at ad idem that identical issue was decided by the Supreme Court in the case of Deputy Commissioner of Income-Tax Vs. Shri Satpuda Tapi Prarisar SSK Ltd. and others [(2010) 231 CTS (SC) 224] and in that case the matter has been remanded by the Supreme Court to the Commissioner of Income Tax (appeals) for deciding it afresh in the light of akl

IN THE HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT AURANGABAD

TAX APPEAL NO. 1 OF 2009 directions issued by the Supreme Court therein. Since the issue involved in the present case is also identical, in our view, the remand order would be appropriate. Hence, we pass the following order.

5.

The impugned order is set aside and the matter is remanded back to the Commissioner of Income Tax (Appeals) for deciding it afresh in the light of the decision of the Supreme Court in the case of Deputy Commissioner of Income Tax Vs. Shri Satpuda Tapi Parisar Sahakari Sakhar Karkhana Ltd. and others [(2010)

CTS

(SC)

224]. ( S. B. DESHMUKH, J. ) ( D. G. KARNIK, J. ) akl

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