The Deputy Commissioner of Income tax, Phagwara V. M/s. The Nakodar Coop. Sugar Mills Ltd., Nakodar

ITA 15/ASR/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5684 (ITAT-AMRITSAR)
• Duration Of Justice: 5 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 15-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMRIK CHAND
• Assessee Lawyers: Y K SUD
• Keywords: Assessment record

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.L. KARWA, VICE PRESIDENT AND SH. MEHAR SINGH, ACCOUNTANT MEMBER I.T.A. NO. 15(ASR)/2011 ASSESSMENT YEAR:2007-08 PAN :AAATT2855J THE DY. COMMR.OF INCOME-TAX, VS. M/S THE NAKODAR CO -OPERATIVE PHAGWARA. SUGAR MILLS LTD., NAKODAR. (APPELLANT) (RESPONDENT) DEPARTMENT BY:SH. AMRIK CHAND, DR ASSESSEE BY: SH. Y.K. SUD, CA ORDER PER MEHAR SINGH, AM, THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF THE CIT(A)-II, LUDHIANA, DATED 03.11.2010. PASSED UNDER SECTION 250(6) OF THE INCOME-TAX ACT,1961 (HEREINAFTER REFERRED TO IN SHO RT THE ACT), RELATING TO ASSESSMENT YEAR 2007-08. 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPE AL: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A), ERRED IN ALLOWING RELIEF ON ACCOUNT OF UNPAID CANE GROWERS. 2. THAT THE LD. CIT(A) WHILE ALLOWING THE RELIEF AS AFOREMENTIONED HAS NOT CONSIDERED THE FACTS AVAILAB LE ON RECORD, ,WHICH SHOWS THAT THE CANE PRICE IS BEING S HOWN AS PAYABLE TO THE CANE GROWERS AND HAS BEEN SHOWN AS O UTSTANDING AND THIS FACT HAS NOT BEEN DENIED BY THE ASSESSEE D URING THE ASSESSMENT PROCEEDINGS. 2 3. THAT THE LD. CIT(A), WHILE ALLOWING THE ABOVE RE LIEF HAS NOT GIVEN ANY REASONING. 4. IT IS PRAYED THAT THE ORDER OF THE LD. CIT(A) BE SET-ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 5. THAT THE APPELLANT REQUESTS FOR LEAVE TO ADD OR AMEND OR ALTER THE GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AN D DISPOSED OF. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE IS COOPERATIVE SOCIETY ENGAGED IN THE BUSINESS OF MANUFACTURE AND SALE OF SUGAR AND MOLASSES. DURING THE ASSESSMENT PROCEEDINGS, THE AO NOTICED THAT THE ASSESSEE HAS SHOWN CANE PRICE PAYABLE AT RS.6,83,67 ,319/- BUT NOT PAID FOR NUMBER OF YEARS. ON QUERY, THE ASSESSEE EXPLAINED THAT THE AMOUNT OF RS.6,11,01,184/- PERTAIN TO THE YEAR 2006-07 WHICH WAS PAID ON RECEIPT OF ASSISTANCE FROM STATE GOVERNMENT IN THE F.Y. 2007-0 8. THE ASSESSEE ALSO FILED COPY OF LEDGER ACCOUNT. THE FURTHER REPLIED T HAT PAYMENT OF RS.57,84,871/- WAS ON ACCOUNT OF CANE PRICE PAYABLE FOR EARLIER YEARS AND THE MILL STILL UNDERTAKES TO PAY THE SAID OUTSTANDING. THE AO AFTER CONSIDERING THE EXPLANATION OF THE ASSESSEE OBSERVED THAT THE A SSESSEE SHOWN OUTSTANDING AT RS.6,83,67,319/- AND THE AMOUNT OF RS.6,11,01,18 4 PERTAINED TO THE YEAR 2006-07, WHICH HAD BEEN PAID ON RECEIPT OF ASSISTAN CE FROM STATE GOVT. IN THE FINANCIAL YEAR 2007-08. THUS, THE AO BY TREATIN G RS.72,66,135/- AS UNPAID AMOUNT MADE ADDITION OF THE SAME. 4. THE LD. DR,SIMPLY RELIED ON THE ORDER OF THE A SSESSING OFFICER AND MADE NO SUBMISSIONS. 5. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER H AND, STRONGLY SUPPORTED THE ORDER OF THE LD. CIT(A). HE ALSO PLAC ED ON RECORD, COPY OF THE JUDGMENT OF HONBLE PUNJAB & HARYANA HIGH COURT, IN THE CASE OF C.I.T. FARIDABAD VS. SMT. SITA DEVI JUNEJA, IN IT.A. NO.61 9 OF 2009, DATED 3 02.12.2009, CONTENDING THAT THE CASE OF THE PRESENT ASSESSEE IS COVERED BY THE SAID DECISION. 6. WE HAVE HEARD BOTH THE PARTIES AND GIVEN OUR THO UGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS, EXAMINED THE FACTS OF THE CASE AND MATERIAL PLACED ON RECORD, INCLUDING THE AFORESAID CASE LAW RELIED UPON BY THE ASSESSEE. WE HAVE ALSO GONE THROUGH THE ORDERS OF THE AUTHORITIE S BELOW. A CAREFUL PERUSAL OF THE IMPUGNED APPELLATE ORDER DATED 03.11.2010, C LEARLY REVEALS THAT THE LD. CIT(A), HAS CONSIDERED AND ADJUDICATED THE ISSU E, IN QUESTION, IN GREATER DETAIL, AFTER APPRECIATION OF THE EVIDENCES AND MAT ERIAL ON RECORD, AS ALSO THE LEGAL AND FACTUAL POSITION OF THE CASE. NEEDLESS TO SAY THAT THE IMPUGNED APPELLATE ORDER IS WELL REASONED AND BASED ON THE C OGENT AND CREDIBLE MATERIAL AND FACTS OF THE CASE. HOWEVER, IT WOULD P ERTINENT TO REPRODUCE THE FINDINGS OF THE CIT(A), FOR THE PURPOSE OF PROPER APPRECIATION OF THE SAME: 6. I HAVE GONE THROUGH THE WRITTEN SUBMISSIONS FIL ED BY THE APPELLANT AND ALSO PERUSED THE RELEVANT ASSESSMENT RECORD. THOUGH THE A.O. HAS MADE AN ADDITION OF RS.72,66,13 5/- ON ACCOUNT OF CANE PRICE PAYABLE OF CANE GROWERS IN TH E PREVIOUS YEARS I.E. PERIOD FROM ASSTT. YEAR 1993-94 TO ASST T. YEAR 2006- 07 ON THE GROUND THAT THIS WAS NOT MORE PAYABLE TO THE CANE GROWERS AND, THEREFORE, THE LIABILITY ON THIS ACCOU NT HAS CEASED. THE APPELLANTS COUNSEL HAS SUBMITTED THAT THE DETA ILS OF CANE PRICE PAYABLE IS AVAILABLE ON THE BALANCE SHEET AND ALSO HE PRESSED UPON THE FACT THAT THIS LIABILITY IS STILL EXIST AND THE CANE PRICE FOR ALL THE YEARS ARE PAYABLE TO THE VARIOUS CANE GROWERS. I FEEL IT WILL BE FAIR LOOKING IN THE PECULIAR NATURE OF THE BUSINESS OF THE APPELLANT BEING A CO-OPERATIVE SUGAR MILLS R UN BY THE PUNJAB GOVT. TO ALLOW THIS LIABILITY FROM A.Y. 2001 -02 I.E. PAST 6 YEARS AND THE ADDITION ON ACCOUNT OF THE EARLIER LIABILITY WHICH ARE VERY OLD HAS RIGHTLY BEEN MADE BY THE A.O. AND THE A.O. DIRECTED TO RECOMPUTE THE ADDITION IN LIGHT OF THE ABOVE DIRECTIONS. THEREFORE, THIS GROUND OF APPEAL IS PAR TLY ALLOWED. 4 6.1. THUS, IN THE LIGHT OF THE FINDINGS GIVEN BY T HE CIT(A) IN HIS IMPUGNED APPELLATE AND THE DECISION OF THE HONBLE HIGH COURT, RELIED UPON BY THE ASSESSEE IN THE CASE OF C.I.T. FARIDABAD VS . SMT. SITA DEVI JUNEJA, IN IT.A. NO.619 OF 2009, DATED 02.12.2009, WE DO NOT F IND ANY INFIRMITY IN THE ORDER OF THE CIT(A) AND THE SAME IS UPHELD. HENCE, THE APPEAL OF THE REVENUE IS DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 22ND JUNE, 2011. SD/- SD/- (H.L. KARWA) (MEHAR SINGH) VICE PRESIDENT ACCOUNTANT MEMBER DATED: 22ND JUNE, 2011 /SKR/ COPY OF THE ORDER IS FORWARDED TO : 1. THE ASSESSEE: M/S. NAKODAR CO-OP. SUGAR MILLS LTD. JALANDHAR. 2. THE DY. C.I.T. JALANDHAR. 3. THE CIT(A), JALANDHAR. 4. THE CIT, JALANDHAR. 5. THE SR DR, ASR TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH : AMRITSAR.