Thiru Arooran Sugars Ltd. v. CIT

227 ITR 432Supreme Court of India1997#2080 most cited

What is Thiru Arooran Sugars Ltd. v. CIT authority for?

When an assessee engages in activities involving both agricultural and manufacturing components, or internal production and consumption, the income must be apportioned. To determine the taxable business income, the value of the self-produced raw material or input consumed internally is to be deducted at its prevalent market value.

55

judgments rely on this decision, according to BharatTax’s citation analysis of 366,314 Indian tax judgments — from 2015 to 2024.

Also referred to as

Thiru Arooran Sugars Ltd v CIT · agricultural income apportionment · market value self-consumed produce · mixed income valuation · captive consumption market price · sugar manufacturing income tax · exempt income calculation · business income from agricultural operations · Section 14A applicability · valuation of raw material · income separation principle

Also reported as

142 CTR 9

Sections most often in play

Section 14ASection 41(1)

Issues it is cited on

written down valuesection 41(1)section 41book profitssection 2(24)section 115jliable to taxsection 115jbdisallowance u/s 14asection 43commissioner (appeals)section 14a

Judgments citing Thiru Arooran Sugars Ltd. v. CIT

DCIT, Circle - 6(1), Kolkata vs. M/S. Birla Corporation Ltd., Kolkata

In the result, appeals filed by the Revenue for AYs 2011-12 &

ITA 2111/KOL/2018[2011-12]Status: DisposedITAT Kolkata31 Oct 2022AY 2011-12

Bench: Sri Rajpal Yadav & Dr. Manish Borad

Section 143(3)Section 250Section 37(1)Section 40Section 43B

…what would be appropriate rate to the adopted as sale price by the TPP unit of the Assessee to its Cement manufacturing units. The Tribunal thereafter referred to the decision of the Hon’ble Supreme Court in the case of Thiru Arooran Sugars Ltd. v CIT, (1997) 227 ITR 432 (SC), as to the meaning of the word “Market Price” wherein in the context of market price of sugarcane which was also a commodity whose price was subject to control by the Government held that the price at which a manufacturer buys sugarcane must be taken to be the market price. The Hon’ble Supreme held that if the price is controlled by the Suga…

D.C.I.T., Circle-5(1), Kolkata vs. M/S Dhunseri Ventures Ltd.(Formerly:Dhunseri Petrochem Ltd.), Kolkata

In the result, the appeal of the assessee is partly allowed

ITA 1989/KOL/2019[2015-16]Status: DisposedITAT Kolkata29 Aug 2022AY 2015-16

Bench: Shri Rajpal Yadav, Vice-(Kz) & Shri Rajesh Kumar

Section 92C

…ated 25.08.2017 wherein the Hon'ble ITAT, Kolkata after considering the judgment of the Calcutta High Court in the case of CIT Vs ITC Ltd (supra) and the provisions of Electricity Act, 2003 and the decision of Apex Court n the case of ThiruArooran Sugars Ltd (227 ITR 432) upheld the assessee's contention that the open market value of electricity for the purposes of Section 80IA should be the price at which the assessees procures power from SEBs. Identical view was again expressed in the case of Dy.CIT Vs Kesoram Industries Limited for AYs 2008- 09 & 2009-10 vide the lead order in ITA No,1722/Kol/2012. 14. For the…

Sri Rajeswari Farms vs. Income Tax Officer

In the result, I pass the following:

WP/12097/2021HC Karnataka08 Dec 2021

Bench: The Hon'Ble Mr.Justice S.R.Krishna Kumar Writ Petition No.12097 Of 2021 (T-It) Between: 1. Sri Rajeswari Farms (Partnership Firm) No.451, 64Th Cross Vth Block, Rajajinagar Bangalore-560 010 Rep By Its Partner Sri K.Janardhana Naidu 2. Sri K Janardhana Naidu S/O K Raghavalu Naidu Aged 72 Years 3. Smt Rajeswari W/O Sri K Janardhana Naidu Aged 63 Years 4. Smt Kamalamma W/O Late Chengama Naidu Aged 90 Years 5. Sri J.Vivek S/O Sri K.Janardhana Naidu Aged 40 Years 6. Sri J.Ajith Raj S/O Sri K.Janardhana Naidu Aged 36 Years Petitioners 2 To 6 Are R/At No.451, 64Th Cross Vth Block, Rajajinagar Bangalore-560 010 …Petitioners (By Sri M.V.Sheshachala, Senior Counsel For Sri Aravind V.Chavan, Advocate)

Section 143

…1 IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 8TH DAY OF DECEMBER, 2021 BEFORE THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR WRIT PETITION No.12097 OF 2021 (T-IT) BETWEEN: 1. SRI RAJESWARI FARMS (PARTNERSHIP FIRM) NO.451, 64TH CROSS VTH BLOCK, RAJAJINAGAR BANGALORE-560 010 REP BY ITS PARTNER SRI K.JANARDHANA NAIDU 2. SRI K JANARDHANA NAIDU S/O K RAGHAVALU NAIDU AGED 72 YEARS 3. SMT RAJESWARI W/O SRI K JANARDHANA NAIDU AGED 63 YEARS 4. SMT KAMALAMMA W/O LATE CHENGAMA NAIDU AGED 90 YEARS 5. SRI J.VIVEK S/O SRI K.JANARDHANA NAIDU AGED 40 YEARS 6. SRI J.AJITH RAJ S/O SRI K.JANAR…

DCIT, Circle-5(1), Kolkata vs. Kesoram Industries Limited, Kolkata

In the result, all the appeals of the revenue for AYs 2012-13, 2014-

ITA 1864/KOL/2019[2015-16]Status: DisposedITAT Kolkata28 Oct 2021AY 2015-16

Bench: Hon’Ble Shri P. M. Jagtap, Vp (Kz) & Hon’Ble Shri A. T. Varkey]

Section 139(1)Section 143(3)Section 2Section 2(24)(x)Section 36Section 36(1)(va)Section 43

…h its lead order in ITA No. 1722/Kol/2012, after considering the judgment of the Calcutta High Court in the case of CIT Vs ITC Ltd (supra), the provisions of Electricity Act, 2003 and the decision of Hon’ble Apex Court in the case of Thiru Arooran Sugars Ltd (227 ITR 432) upheld the assessee’s contention that the open market value of electricity for the purposes of Section 80IA(8) should be the price at which the assessee procures power from SEBs. The relevant findings are as under: 21. We have considered the rival submissions and perused the documents in the paper book which inter alia contained Electricity Act…

DCIT, Circle - 5(1), Kolkata vs. M/S. Kesoram Industries Ltd., Kolkata

In the result, all the appeals of the revenue for AYs 2012-13, 2014-

ITA 1777/KOL/2019[2012-13]Status: DisposedITAT Kolkata28 Oct 2021AY 2012-13

Bench: Hon’Ble Shri P. M. Jagtap, Vp (Kz) & Hon’Ble Shri A. T. Varkey]

Section 139(1)Section 143(3)Section 2Section 2(24)(x)Section 36Section 36(1)(va)Section 43

…h its lead order in ITA No. 1722/Kol/2012, after considering the judgment of the Calcutta High Court in the case of CIT Vs ITC Ltd (supra), the provisions of Electricity Act, 2003 and the decision of Hon’ble Apex Court in the case of Thiru Arooran Sugars Ltd (227 ITR 432) upheld the assessee’s contention that the open market value of electricity for the purposes of Section 80IA(8) should be the price at which the assessee procures power from SEBs. The relevant findings are as under: 21. We have considered the rival submissions and perused the documents in the paper book which inter alia contained Electricity Act…

Kesoram Industries Ltd., Kolkata vs. D.C.I.T., Circle-5(1), Kolkata

In the result, all the appeals of the revenue for AYs 2012-13, 2014-

ITA 1197/KOL/2019[2014-15]Status: DisposedITAT Kolkata28 Oct 2021AY 2014-15

Bench: Hon’Ble Shri P. M. Jagtap, Vp (Kz) & Hon’Ble Shri A. T. Varkey]

Section 139(1)Section 143(3)Section 2Section 2(24)(x)Section 36Section 36(1)(va)Section 43

…h its lead order in ITA No. 1722/Kol/2012, after considering the judgment of the Calcutta High Court in the case of CIT Vs ITC Ltd (supra), the provisions of Electricity Act, 2003 and the decision of Hon’ble Apex Court in the case of Thiru Arooran Sugars Ltd (227 ITR 432) upheld the assessee’s contention that the open market value of electricity for the purposes of Section 80IA(8) should be the price at which the assessee procures power from SEBs. The relevant findings are as under: 21. We have considered the rival submissions and perused the documents in the paper book which inter alia contained Electricity Act…

M/S. Kesoram Industries Ltd., Kolkata vs. DCIT, Circle - 5(1), Kolkata

In the result, all the appeals of the revenue for AYs 2012-13, 2014-

ITA 1650/KOL/2019[2015-16]Status: DisposedITAT Kolkata28 Oct 2021AY 2015-16

Bench: Hon’Ble Shri P. M. Jagtap, Vp (Kz) & Hon’Ble Shri A. T. Varkey]

Section 139(1)Section 143(3)Section 2Section 2(24)(x)Section 36Section 36(1)(va)Section 43

…h its lead order in ITA No. 1722/Kol/2012, after considering the judgment of the Calcutta High Court in the case of CIT Vs ITC Ltd (supra), the provisions of Electricity Act, 2003 and the decision of Hon’ble Apex Court in the case of Thiru Arooran Sugars Ltd (227 ITR 432) upheld the assessee’s contention that the open market value of electricity for the purposes of Section 80IA(8) should be the price at which the assessee procures power from SEBs. The relevant findings are as under: 21. We have considered the rival submissions and perused the documents in the paper book which inter alia contained Electricity Act…

Star Paper Mills Limited, Kolkata vs. DCIT, Cir. 4(2), Kolkata

In the result, the appeal of the assessee is partly allowed

ITA 127/KOL/2021[2016-17]Status: DisposedITAT Kolkata26 Oct 2021AY 2016-17

Bench: Shri P. M .Jagtap, Vice-(Kz) & Shri A. T. Varkey, Jm]

Section 143(3)Section 144CSection 80ISection 92B

…h its lead order in ITA No. 1722/Kol/2012, after considering the judgment of the Calcutta High Court in the case of CIT Vs ITC Ltd (supra), the provisions of Electricity Act, 2003 and the decision of Hon’ble Apex Court in the case of Thiru Arooran Sugars Ltd (227 ITR 432) upheld the assessee’s contention that the open market value of electricity for the purposes of Section 80IA(8) should be the price at which the assessee procures power from SEBs. The relevant findings are as under: 21. We have considered the rival submissions and perused the documents in the paper book which inter alia contained Electricity Act…

D.C.I.T., Circla-10(2), Kolkata vs. M/S Balarampur Chini Mills Ltd., Kolkata

In the result, the appeal filed by the Revenue is dismissed

ITA 1672/KOL/2019[2016-17]Status: DisposedITAT Kolkata05 May 2021AY 2016-17

Bench: Sri J. Sudhakar Reddy & Sri Aby T. Varkey)

Section 142(1)Section 143Section 143(2)Section 250Section 3Section 6Section 8Section 80ASection 80ISection 92C

…d 25.08.2017 wherein the Hon'ble ITAT, Kolkata after considering the judgment of the Calcutta High Court in the case of CIT Vs ITC Ltd. (supra) and the provisions of Electricity Act, 2003 and the decision of Apex Court in the case of Thiru Arooran Sugars Ltd (227 ITR 432) upheld the assessee's contention that the open market value of electricity for the purposes of Section 80IA should be the price at which the assessees procures power from SEBs. 13. For the reasons set out in the foregoing therefore I hold that the methodology and benchmarking performed by the appellant (also judicially approved by higher judicia…

JCIT (OSD), Cir-11(1), Kolkata vs. M/S Khaitan India Ltd., Kolkata

In the result, both the appeals of the Revenue are dismissed

ITA 980/KOL/2016[2002-2003]Status: DisposedITAT Kolkata03 May 2019AY 2002-2003

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 148Section 2

…e taking into account, gross agricultural income and agricultural expenses. According to the A.O., the computation of agricultural income was not as per Rule 7 and in the light of judicial decisions of Hon’ble Supreme Court in Thiru Arooran Sugars Ltd. vs CIT 227 ITR 432 (SC). Thereafter, the A.O. computed the total income in accordance with Rule 7 of the Rules and disallowed on account of agricultural expenses claimed at Rs. 95,42,450/-. The A.O. disallowed depreciation of Agricultural Division of Rs. 6,70,554/-. According to the A.O. the prevalent market rate of sugarcane was Rs. 75.54 per quintal and the asses…

JCIT (OSD), Cir-11(1), Kolkata vs. M/S Khaitan India Ltd., Kolkata

In the result, both the appeals of the Revenue are dismissed

ITA 979/KOL/2016[2001-2002]Status: DisposedITAT Kolkata03 May 2019AY 2001-2002

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 148Section 2

…e taking into account, gross agricultural income and agricultural expenses. According to the A.O., the computation of agricultural income was not as per Rule 7 and in the light of judicial decisions of Hon’ble Supreme Court in Thiru Arooran Sugars Ltd. vs CIT 227 ITR 432 (SC). Thereafter, the A.O. computed the total income in accordance with Rule 7 of the Rules and disallowed on account of agricultural expenses claimed at Rs. 95,42,450/-. The A.O. disallowed depreciation of Agricultural Division of Rs. 6,70,554/-. According to the A.O. the prevalent market rate of sugarcane was Rs. 75.54 per quintal and the asses…

Asst CIT (Ltu) 2, Mumbai vs. Reliance Industries Ltd, Mumbai

ITA 1547/MUM/2016[2010-11]Status: DisposedITAT Mumbai28 Sept 2018AY 2010-11

Bench: S/Shri B.R.Baskaran (Am) & Amarjit Singh (Jm)

Section 43B

…w in favour of the assessee should be taken, in case where two different views of non-jurisdictional High Courts are available. The Co-ordinate bench also considered the decision rendered by Hon’ble Supreme Court in the case of Thiru Arooran Sugars ltd (1997)(227 ITR 432), wherein the question of determination of agricultural income in respect of Sugar cane grown by the assessee, which was also consumed captively. The Hon’ble Supreme court held that the price of sugar cane should be adopted at market price only. The co-ordinate bench also noticed that another co-ordinate bench has held that the market price shoul…

Saf Yeast Company P.Ltd, Mumbai vs. Asst CIT Cen Cir 40, Mumbai

In the result the appeal of the assessee for AY 2009-10 is partly allowed

ITA 1875/MUM/2014[2009-10]Status: DisposedITAT Mumbai16 May 2018AY 2009-10

Bench: Shri B.R. Baskaran (Am)& Shri Pawan Singh (Jm)

Section 80I

…as Rs. 3.50 per unit, it had to be taken into account while computing amount of eligible profit available for deduction under section 80- IA - Held, yes [In favour of assessee]." Further, Hon'ble Supreme Court in the case of Thiru Arooran Sugars Ltd vs. CIT (227 ITR 432) held: 43 M/s. Saf Yeast Company Private Limited "Section 2(1A) of the Income-tax Act, 1961, read with rule 7(2) of the Income-tax Rules, 1962 - Agricultural income - Assessment years 1962-63 to 1967-68 - Whether formula contained in clause (b) of rule 7(2) will apply only in cases where agricultural produce is not ordinarily sold in market in…

Kesoram Industries Limited, Kolkata vs. DCIT, Circle-5(1), Kolkata

In the result the revenue’s appeals for A

ITA 505/KOL/2017[2009-10]Status: DisposedITAT Kolkata26 Apr 2018AY 2009-10

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 10(34)Section 143(3)Section 14ASection 250

…wherein this Tribunal after considering the judgment of the Hon’ble Calcutta High Court in the case of CIT vs ITC Ltd. (supra) and the provisions of Electricity Act, 2003 and the decision of the Hon’ble Apex Court in the case of Thiru Arooran Sugar Ltd.vs CIT 227 ITR 432 (SC) had held that the open market value of electricity for the purposes of section 80IA should be the price at ITA No. 1188/Kol/2016 ITA No. 505/Kol/2017 Kesoram Industries Ltd., AYs- 2008-09 & 2009-10 which the assessee procured power from SEBs. The learned AR pointed out that the ITC’s case decided by Hon’ble Calcutta High Court and which has…

Kesoram Industries Ltd., Kolkata vs. DCIT, Cir-5, Kolkata

In the result the revenue’s appeals for A

ITA 1188/KOL/2016[2008-09]Status: DisposedITAT Kolkata26 Apr 2018AY 2008-09

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 10(34)Section 143(3)Section 14ASection 250

…wherein this Tribunal after considering the judgment of the Hon’ble Calcutta High Court in the case of CIT vs ITC Ltd. (supra) and the provisions of Electricity Act, 2003 and the decision of the Hon’ble Apex Court in the case of Thiru Arooran Sugar Ltd.vs CIT 227 ITR 432 (SC) had held that the open market value of electricity for the purposes of section 80IA should be the price at ITA No. 1188/Kol/2016 ITA No. 505/Kol/2017 Kesoram Industries Ltd., AYs- 2008-09 & 2009-10 which the assessee procured power from SEBs. The learned AR pointed out that the ITC’s case decided by Hon’ble Calcutta High Court and which has…

Kesoram Industries Limited, Kolkata vs. Addl C.I.T RG - 5, Kolkata

In the result the revenue’s appeals for A

ITA 773/KOL/2013[2009-10]Status: DisposedITAT Kolkata26 Apr 2018AY 2009-10

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 10(34)Section 143(3)Section 14ASection 250

…wherein this Tribunal after considering the judgment of the Hon’ble Calcutta High Court in the case of CIT vs ITC Ltd. (supra) and the provisions of Electricity Act, 2003 and the decision of the Hon’ble Apex Court in the case of Thiru Arooran Sugar Ltd.vs CIT 227 ITR 432 (SC) had held that the open market value of electricity for the purposes of section 80IA should be the price at ITA No. 1188/Kol/2016 ITA No. 505/Kol/2017 Kesoram Industries Ltd., AYs- 2008-09 & 2009-10 which the assessee procured power from SEBs. The learned AR pointed out that the ITC’s case decided by Hon’ble Calcutta High Court and which has…

D.C.I.T Cir - 5, Kolkata vs. M/S Kesoram Industries Limited, Kolkata

In the result the revenue’s appeals for A

ITA 1995/KOL/2013[2009-10]Status: DisposedITAT Kolkata26 Apr 2018AY 2009-10

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 10(34)Section 143(3)Section 14ASection 250

…wherein this Tribunal after considering the judgment of the Hon’ble Calcutta High Court in the case of CIT vs ITC Ltd. (supra) and the provisions of Electricity Act, 2003 and the decision of the Hon’ble Apex Court in the case of Thiru Arooran Sugar Ltd.vs CIT 227 ITR 432 (SC) had held that the open market value of electricity for the purposes of section 80IA should be the price at ITA No. 1188/Kol/2016 ITA No. 505/Kol/2017 Kesoram Industries Ltd., AYs- 2008-09 & 2009-10 which the assessee procured power from SEBs. The learned AR pointed out that the ITC’s case decided by Hon’ble Calcutta High Court and which has…

ACIT, Circle-5, Kolkata vs. M/S Kesoram Industries. Ltd, Kolkata

In the result the revenue’s appeals for A

ITA 1722/KOL/2012[2008-2009]Status: DisposedITAT Kolkata26 Apr 2018AY 2008-2009

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 10(34)Section 143(3)Section 14ASection 250

…wherein this Tribunal after considering the judgment of the Hon’ble Calcutta High Court in the case of CIT vs ITC Ltd. (supra) and the provisions of Electricity Act, 2003 and the decision of the Hon’ble Apex Court in the case of Thiru Arooran Sugar Ltd.vs CIT 227 ITR 432 (SC) had held that the open market value of electricity for the purposes of section 80IA should be the price at ITA No. 1188/Kol/2016 ITA No. 505/Kol/2017 Kesoram Industries Ltd., AYs- 2008-09 & 2009-10 which the assessee procured power from SEBs. The learned AR pointed out that the ITC’s case decided by Hon’ble Calcutta High Court and which has…

Kesoram Industries Ltd., Kolkata vs. Add.CIT, Range-5, Kolkata

In the result the revenue’s appeals for A

ITA 1037/KOL/2012[2008-2009]Status: DisposedITAT Kolkata26 Apr 2018AY 2008-2009

Bench: Shri A. T. Varkey, Jm & Dr. A. L. Saini, Am]

Section 10(34)Section 143(3)Section 14ASection 250

…wherein this Tribunal after considering the judgment of the Hon’ble Calcutta High Court in the case of CIT vs ITC Ltd. (supra) and the provisions of Electricity Act, 2003 and the decision of the Hon’ble Apex Court in the case of Thiru Arooran Sugar Ltd.vs CIT 227 ITR 432 (SC) had held that the open market value of electricity for the purposes of section 80IA should be the price at ITA No. 1188/Kol/2016 ITA No. 505/Kol/2017 Kesoram Industries Ltd., AYs- 2008-09 & 2009-10 which the assessee procured power from SEBs. The learned AR pointed out that the ITC’s case decided by Hon’ble Calcutta High Court and which has…

K.P.R.Mill Limited, Chennai vs. ACIT Corporate Circle 2, Coimbatore

In the result, the appeal filed by the assessee is partly allowed

ITA 1915/CHNY/2017[2013-14]Status: DisposedITAT Chennai24 Jan 2018AY 2013-14

Bench: Shri N.R.S. Ganesan & Shri S. Jayaramanआयकर अपील सं./Ita No.1915/Mds/2017 "नधा"रण वष" / Assessment Year : 2013-14

For Appellant: Shri S. Sridhar, AdvocateFor Respondent: Smt. Ruby George, CIT

…der the Electricity Act 2003, when the Captive Generation plant notionally sells electricity to itself, there is no regulation in respect of market price. In this connection, the decision of Supreme Court in the case of Thiru Arooran Sugars Ltd. v. CIT (1997) 227 ITR 432 is material. In that case, the assessee company was a manufacturer of sugar which purchased sugarcane from the market for crushing. It also had its own cane fields where it cultivated sugarcane, which was entirely consumed by its factory. Since the profit made by the assessee from the sale of sugar arose out of agricultural activities as well as…