ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE -1, KOLHAPUR, KOLHAPUR vs. SHREE TATYASAHEB KORE WARANA SAHAKARI SAKHAR KARKHANA LTD., MAHARASHTRA

1 The Revenue has raised the following grounds of appeal :

The ld.DR for the Revenue relied on the order of the Assessing Officer. Ld.DR submitted that since A.Y.2015-16 has been set-aside by ITAT to Assessing Officer(AO) for denovo adjudication following the principles laid down by Hon'ble Supreme Court in the case of CIT Vs. Krishna SSK [2012] 211 Taxmann 109 (SC), the A.Y.2007-08 to A.Y.2014-15 may also be set-aside. Ld.DR also relied on the decision of Co-ordinate Bench of the ITAT Pune in the case of Shree Adinath SSK Ltd., in ITA No.485/PUN/2019 for A.Y.2013-14 dated 11.05.2022. 2.1 Mr.Ajay Kumar Keshari -ld.CIT(DR) in the written submission submitted that it is evident that the sale of sugar by the sugar factories to their members is not a discretionary decision of the factory, but is regulated under section 79(A) of the Maharashtra Co-operative Societies Act, 1960. In accordance with this provision, the Sugar Commissioner, Pune has issued a circular to regulate the sale of sugar to members. As stated above, the sale of sugar to a member should not exceed 5 kg per month at a concessional/subsidized rate. Hence, there is no ambiguity regarding the regulation of sugar sales to members. Furthermore, it is important to highlight that the Assessing Officer(AO) took note of this regulation and the circular and incorporated the same into the assessment orders for A.Y.2017-18 and A.Y.2018-19. The AO carefully examined the matter based on the practices adopted by the State Government as per its Policy and made an addition for the Differential Amount between the Market Price and the Concessional Rate.

2 It is evident that the State Government has already enacted legislation under section 79(A) of the Maharashtra Co-operative Societies Act, 1960 to discourage the practice of selling sugar at concessional rates. Additionally, the Hon'ble Supreme Court's decision in CIT Vs. Krishna SSK [2012] 211 Taxmann 109 (SC), along with the provisions of the Maharashtra Co-operative Societies Act, 1960 and the circular dated 01.03.2006 issued by the Sugar Commissioner, Pune have provided clear guidelines on the matter.

The ld.Authorised Representative(ld.AR) for the assessee filed a paper book. Ld.AR submitted that this issue is already covered by the decision of Hon'ble Jurisdictional High Court in the case of Assessee in Income Tax Appeal(Lodg.) No.2726 of 2009, dated 01.02.2010. 3.1 Ld.AR submitted that the issue had attained finality by Hon'ble Bombay High Court's order in assessee's own case in Income Tax Appeal(Lodg.) No.2726 of 2009, dated 01.02.2010 vide which Hon'ble Bombay High Court dismissed the appeal of the Revenue. Ld.AR further submitted that Revenue has not filed any SLP against the decision of Hon'ble Bombay High Court regarding sale of sugar at concessional rate. Therefore, ld.AR pleaded that this issue has attained finality for the assessee.

We have heard both the parties and perused the records. With the consent of both the parties, these appeals were heard together as the issue involved is same, grounds of appeal raised are same. We took appeal for A.Y.2007-08 as lead appeal.

1 Assessee is a Co-operative Society. Assessee filed Return of Income on 30.10.2007 disclosing total income at Rs.NIL and claiming carry forward losses of earlier years of Rs.7,64,55,198/-. Then, assessee filed a revised Return of Income on 26.03.2009 increasing the losses to Rs.7,82,30,508/-. The Assessee's case was selected for scrutiny. The assessment order under section 143(3) was passed on 30.10.2009 making an addition of Rs.43,56,64,963/- on account of excessive cane price paid to the Farmers over the admissible price and Rs.2,76,65,568/- on account of sale of sugar at concessional rate to its members and non-members. Aggrieved by the assessment order, Assessee filed appeal before the ld.CIT(A). The ld.CIT(A) partly confirmed the addition. Appeal was filed before the ITAT by Revenue as well as Assessee. The appeals Number are as under :

2 The appeal in ITA No.251/PUN/2012 and ITA No.252/PUN/2012 were heard on 19.03.2019 and order was pronounced on 01.05.2019by ITAT Pune “A” Bench. In these group of appeals, total 120 appeals were decided together by a common order.

3 The appeal in ITA No.205/PUN/2012, ITA No.599/PUN/2012, ITA No.2141/PUN/2012 and ITA No.2145/PUN/2012 were heard on 12.03.2019 by ITAT Pune "B" Bench and the same order was pronounced on 14.03.2019. In this group of appeals, total 162 cases were heard and decided together by a common order.

1 The appeal in ITA No.827/PUN/2017, 828/PUN/2017 and ITA No.829/PUN/2017, ITA No.830/PUN/2017 and ITA No.1756/PUN/2017 were heard by ITAT on 25.09.2019 and decided vide order dated 01.10.2019 by a common order consisting of 75 appeals.

4 All these appeals were decided by ITAT Pune by a common order along with other cases. The Assessing Officer in assessment order for A.Y.2007-08 dated 28.09.2021 has referred wrong ITA Appeal Numbers. The ITAT vide its common order 14.03.2019, 01.05.2019 and 01.10.2019set-aside the issue to the Assessing Officer, following the decision of Hon'ble Supreme Court in the case of CIT Vs. Krishna Sahakari Karkhana Limited [2012] 27 taxmann.com 162 (SC) order dated 25.09.2012. The ITAT directed Assessing Officer to verify following aspects :