MANGANGA SAHAKARI SAKHAR KARKHANA LTD.,SANGLI vs. ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE, SANGLI

PDF · subscribers
ITA 241/PUN/2020Status: DisposedITAT Pune08 July 2022AY 2003-043 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal followed a previous ITAT decision and the Supreme Court's ruling in the Krishna Sahakari Sakhar Karkhana Ltd. case. The matter was set aside to the Assessing Officer for fresh consideration.

What were the facts?

The assessee, a sugar factory, sold sugar to cane growers at a concessional rate, which the Assessing Officer treated as distribution of profit and added to income. The CIT(A) confirmed this addition.

What were the issues?

Whether the difference between the market price and the concessional rate at which sugar was sold to farmers constitutes an appropriation of profit.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, “A”

Before: SHRI S.S.GODARA & DR. DIPAK P. RIPOTE

For Respondent: Shri Arvind Desai – DR
Hearing: 16/06/2022Pronounced: 08/07/2022

Assessee by None. Revenue by Shri Arvind Desai – DR Date of hearing 16/06/2022 Date of pronouncement 08/07/2022 आदेश/ ORDER

PER DR.DIPAK P.RIPOTE, AM:

1.

This appeal filed by the Assessee is directed against the order of ld.Commissioner of Income-tax(Appeals)-1, Kolhapur’s, order dated 12.12.2019 for the Assessment Year 2003-04, involving proceedings under section 143(3) of the Income Tax Act, 1961. The Assessee has raised the following grounds of appeal: “1. On the fact and circumstance of the case and in law of the learned Commissioner of Income Tax (Appeals)-1, Kolhapur has erred in disallowing and adding back an amount of Rs.27,43,990/- on account of Sale of sugar at concessional rate.

2. The appellant craves for the leave, add, alter, amend, modify and delete any or all the above grounds of appeals before or at the time of hearing.”

A.Y.2003-04 Manganga Sahakari Sakhar Karkhana Ltd., (A)

2.

Brief facts of the case are that the Appellant Assessee is a sugar factory. During the assessment proceedings the Assessing Officer (AO) observed that the assessee had sold sugar to cane grower farmers at a concessional rate. They sold the sugar at Rs808/- pr qtls to farmers but the Fair market price was Rs.1105 per quintal. They sold 7663 Quintals to farmers at concessional rate. The AO treated the difference as distribution of profit to members and added it.

2.1 The Ld.Commissioner of Income Tax(Appeals) confirmed the addition.

2.2 Aggrieved by the order of the ld.Commissioner of Income Tax(Appeals) the assessee filed the present appeal before this Tribunal.

3.

We have heard the Ld.DR for the Revenue and perused the material available on records. It is observed that the said issue has been decided by the ITAT Pune Bench in the case of Majalgaon Sahakari Sakhar Karkhana Ltd., & Others. The ITAT Pune has held as under: “In our considered opinion it would be just and fair if the impugned orders on this score are set aside and the matter is restored to the file of AOs, instead of to the CITs(A), for fresh consideration as to whether the difference between the average price of sugar sold in the market and that sold to members at concessional rate is appropriation of profit or not, in the light of the directions given by A.Y.2003-04 Manganga Sahakari Sakhar Karkhana Ltd., (A)

the Hon’ble Supreme Court in the case of Krishna Sahakari Sakhar Karkhana Limited (supra).” 4. Respectfully following the above decision, we set aside this issue to the file of Assessing Officer for re-adjudication in the light of the Hon’ble Supreme Court’s decision in the case of Krishna Sahakari Sakhar Karkhana Ltd., (2012) 27 taxmann.com 162 (SC), order dated 25.09.2012. Accordingly, the Ground No.1 is allowed for statistical purpose.

4.1 In the result, Ground No.1 of the assessee is allowed for statistical purpose.

5.

Thus, the appeal of the Assessee is allowed for statistical purpose.

Order pronounced in the open Court on 8th July, 2022.

Recent GST High Court judgments

Search GST case law →