M/s. UJJAINI BEEJ UTPADAK SAHAKARI MARYADIT, Ujjain V. The ITO 1(1), Ujjain

ITA 592/IND/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99248 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 3 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 11-09-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Keywords: Reasonable cause; Fair market value; Cancellation of registration

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE (SINGLE MEMBER CASE) BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER I.T.A.NO. 592/IND/2014 A.Y. : 2009-10 UJJAINI BEEJ UTPADAK SAHAKARI MARYADIT, ITO, 1(1), UJJAIN VS. UJJAIN APPELLANT RESPONDENT PAN NO. AABFU8607N A PPELLANT S BY : SHRI PRAKASH JAIN, C. A. RESPONDENT BY : SHRI R.A.VERMA, DR O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A), UJJAIN, DATED 11.06.2014, FOR THE ASSESS MENT YEAR 2009-10. 2. THE ONLY SUBSTANTIVE GROUND IN THIS APPEAL IS GROUN D NO.2., WHICH READS AS UNDER :- DATE OF HEARING : 21 . 12 . 201 5 . DATE OF PRONOUNCEMENT : 21 . 12 .201 5 . UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 2 2 THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN UPHOLDING THE AOS ACTION I N RESPECT OF DISALLOWANCE OF DEDUCTION CLAIMED U/S 80 P OF RS. 11,13,034/- WITHOUT CONSIDERING THE FACTS OF TH E CASE AND SUBMISSION MADE BEFORE HIM. 3. THIS APPEAL IS TIME BARRED BY ONE DAY. TO THIS EFFE CT, THE SECRETARY OF UJJAINI BEEJ UTPADAK SAHAKARITA MY DT, UJJAIN, HAS FILED AN AFFIDAVIT STATING ON OATH THAT THE SOC IETY RECEIVED THE ORDER OF CIT(A)-I , UJJAIN FOR THE ASSESSMENT Y EAR 2009-10 ON 12.07.2014, THE TIME LIMIT FOR FILING OF APPEAL WAS 10.09.2014, BUT DUE TO THE ILL HEALTH OF SECRETARY, THE SAME COULD NOT FILE ON THIS DATE AND THE SAME WAS FILED ON 11.09.2014. THE ASSESSEE PRAYED FOR CONDONATION OF DELAY. 4. I HAVE GONE THROUGH THE CONTENTS OF THE AFFIDAVIT A S WELL AS THE APPLICATION SUBMITTED BY THE SECRETARY, SHRI PRAKASH CHANDRA JHANJHRI. I FIND THAT THE DELAY WAS DUE TO REASONABLE CAUSE, AS HE WAS SUFFERING FROM VIRAL FE VER. I, THEREFORE, CONDONE THE DELAY OF ONE DAY. 5. THE SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE SOCIETY IS ENGAGED IN CO-OPERATIVE MOVEMENT OF SEED UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 3 3 PRODUCTION AND MARKETING. THE ASSESSEE SOCIETY HAS TO FOLLOW SET PROCEDURE FOR CERTIFICATION OF SEEDS. THE CERTI FICATION OF SEEDS IS DONE BY MADHYA PRADESH STATE SEEDS CERTIFI CATION AGENCY. THE SEEDS ARE ALSO RANDOMLY VERIFIED BY THE DDA ALSO. THE DDA IS GIVING SUBSIDY TO THE ASSESSEE FOR WHICH THEY HAD CARRIED OUT THE RANDOM VERIFICATION WHETHER THE SOC IETY IS FOLLOWING RULES AND REGULATIONS OF THE GOVERNMENT. IN ORDER TO VERIFY THE QUALITY OF SEED, THE DDA HAS CARRIED OUT INSPECTION ON 19.07.2010. DURING THE COURSE OF THE INSPECTION OF THE DDA, FOLLOWING DISCREPANCIES WERE FOUND :- D`F'K VKNKU XQ.K FU;A=.K DS RGR NY }KJK MTTS;UH CHT MRIKND LGDKFJRK E;KZFNR] 70 ] FPEUXAT E.MH MTTSU] FTYK DS ;GKW FUJH{K.K DS NKSJKU FUEUKUQLKJ VFU;FERRK,A IK;H XBZ %& 1- LVKWD IATH UGHA IKBZ XBZ A DSK DZSFMV ESEKS FU/K KZFJR IZI= ESA UGHA GSA D`'KDKSA DKS FN;S TK JGS FCYKSA ESA YK WV UACJ VAFDR UGHA FD;K TK JGK GSA YKWV DZEKAD VAFDR U FD, TKUS L S D`'KDKSA DKS FN, CHT DK LR;KIU DJUK LAHKO UGHA A UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 4 4 2- LAACAF/KR LALFKK DS LFPO }KJK FUJH{K.K NY DKS LVKWD CQD] FCY CQD VFHKJ{KK ESA NSUS LS LI'VR% BADKJ FD;K X;K ,OA UGHA FN;K X;KA 3- IZFRCAF/KR LKS;KCHU LEJFDAX DS CSXKSA IJ VSX UGHA I K, X, GSA] ,SLH FLFKFR ESA BLS CHT DH JS.KH ESA UGHA J[KK TK L DRK GSA MIJKSDRKUQLKJ IKBZ XBZ VFU;FERRK,A CHT VF/KFU;E 190 6 DH /KKJK 6] 7 ,OA 14MH DK LI'V MYYA?KU GSA VR% ESA MI LAPKYD D`F'K ,OA CHT VUQKKIU VF/KDKJH] F TYK MTTSU CHT FU;A=.K VKNSK 1983 DS [K.M 11 ESA IZNR R 'KFDR;KSA DK MI;KSX DJRS GQ, LALFKK MTTS;UH CHT MRI KND] LGDKFJRK E;KFNR] 8] FPEUXAT E.MH] MTTSU] FTYK MTTSU DK CHT FODZ; IATH;U DZEKAD 836 VU; VKXKEH VKNSK RD RRDKY IZHKKO LS FUYAFCR DJRK GWA FUYACU VOF/K ESAS FODZSRK FDLH HKH IZDKJ DK CHT O;O LK; UGHA DJ LDSXKA** 6. THE DDA VIDE ITS ORDER DATED 19.7.2010HAS CANCELLED THE REGISTRATION NO. 836 OF THE SOCIETY. THE SOCIET Y WAS SUPPLYING THE POOR QUALITY OF SEED TO THE ILLITERAT E FARMERS. ON UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 5 5 THE OTHER HAND, THE SOCIETY WAS RECEIVING SUBSIDY F ROM THE GOVERNMENT. THEREFORE, THE AO HAS DISALLOWED THE DE DUCTION U/S 80P OF THE ACT. THEREFORE, THE ASSESSEE IS IN A PPEAL BEFORE THE CIT(A) AND CIT(A) HAS DISMISSED THE APPEAL OF T HE ASSESSEE. 7. THE LD. AUTHORIZED REPRESENTATIVE HAS MADE THE WRITTEN SUBMISSION, WHICH READS AS UNDER :- THAT THE SOCIETY AFFECTED THE SALES TO DDA, BETUL, DHAR, KATANI, KHANDWA , KHARGONE, SHAJAPUR, BADRA , BHIND WHEREAS THE TERRITORIAL JURISDICTION OF THE SOCIETY IS WITHIN THE DISTRICT OF UJJAIN AS PER THE BYE-LAWS OF THE SOCIETY. THE REGISTRATION OF THE SOCIETY WAS CANCELLED BY THE DEPUTY DIRECTORS AGRICULTURE AND ANUGYAPAN OFFICER, KISAN KALYAN AND KISAAN VIKAS, DISTRICT UJJAIN FOR THE REASON TH AT DURING THE COURSE OF INSPECTION STOCK REGISTER WAS NOT FOUND , THE SECRETARY OF THE SOCIETY REFUSED TO GIV E STOCK BOOK AND BILL BOOK IN THE CUSTODY OF THE INSPECTING TEAM AND THERE WAS ABSENCE OF TAG ON UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 6 6 POOR QUALITY OF SOYA BEEN SEED'S BAGS. IT IS SUBMITTED THAT THE LD.A.O. AND LD. CIT(A) HAS NOT APPRECIATED THE FACTS OF THE CASE AND BY CREATING CONFUSION DISALLOWED THE APPELLANT'S CLAIM U/S 80 WITHOUT PROPERLY EXAMINING THE BYE-LAWS OF THE SOCIETY AND RESULT OF THE ENQUIRY BY THE INSPECTION TEAM, WHICH WILL BE CLEAR FROM THE FOLLOWINGS :- IT IS WRONG TO SAY THAT AS PER THE BYE LAWS OF THE SOCIETY IT COULD NOT SALE THE SEED OUT OF THE UJJAI N AND SALES OF SEED AFFECTED TO DDA, BETUL, DHAR, KATANI KHANDWA, KHARGONE, SHAJAPUR, BADRA , BHIND IS IN VIOLATION OF BYE LAWS OF SOCIETY. IF YOUR HONOUR WILL GO THROUGH THE BYE LAWS OF THE SOCIETY YOU WILL FIN D THAT THE RELEVANT BYE LAWS OF THE SOCIETY READS AS UNDER:- 1-3 LGDKFJRK DK DK;Z{KS= MTTSU FTYK JGSXKA 2-5 DK;Z{KS= LS RKRI;Z OG {KS= TGKW LS LNL;RK YH TK LDRH GSA UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 7 7 3-4 LFEFR DS LNL;KSA }KJK MRIKFNR CH T DK FORJ.K@LH/KS FODZ; }KJK FOI.KU DJUKA FROM THE PARA 1.3 & 2.5 ABOVE IT IS CLEAR THAT THE ONLY PEOPLE OF UJJAIN COULD BE THE MEMBER OF THE SOCIETY AND FROM THE 3.4 IT IS CLEAR THAT SEED PRODUCED BY THE MEMBERS CAN BE SOLD THROUGH DISTRIBUTOR OR DIRECTLY TO THE USER. THUS THE INTERPRETATION MADE BY THE LD.A.O. AND LD. CIT(A) THAT THE SOCIETY HAS VIOLATED ITS BYE LAWS B Y SELLING THE SEED OUTSIDE THE TERRITORY OF UJJAIN I. E, BETUL, DHAR, KATANI, KHANDWA , KHARGONE, SHAJAPUR, BADRA , BHIND IS NOT CORRECT AND WITHOUT PROPERLY READING THE BY LAWS OF THE SOCIETY. AS TO THE CANCELLATION OF REGISTRATION BY THE DEPUT Y DIRECTOR AGRICULTURAL VIDE ORDER DATED 19.07.2010 W E HAVE TO SUBMIT AS UNDER:- THE ASSESSMENT YEAR UNDER APPEAL IS 2009-10 I.E. UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 8 8 01.04.2008 TO 31.03.2009 AND THE REGISTRATION WAS CANCELLED ON 19.07.2010 WHICH IS AFTER MORE THAN 1 YEAR OF THE CLOSER OF ASSESSMENT YEAR , THUS THE CANCELLATION OF REGISTRATION IS NOT APPLICABLE FOR THE ASSESSMENT YEAR IN QUESTION WHICH WILL BE CLEAR FRO M THE FACT THAT THAT THE SUBSIDY RELATING TO THE ASSESSMENT YEAR IN QUESTION WAS DISBURSED BY THE DEPUTY DIRECTOR AGRICULTURE , KISSAN KALYAN AND KRISHI VIKAS DETAIL AS UNDER :- DATE OF SUBSIDY APPROVAL LETTER AMOUNT IN RS. P.B. 19.02.2010 63,275 34 TO 40 11.02.2009 8,30,200 43 & 44 31.03.2009 5,38,928 45 & 46 18.05.2009 2,28,185 47 & 48 TOTAL 16,60,588 THUS IT IS WRONG AND IRRELEVANT TO APPLY THE EFFECT OF CANCELLATION OF REGISTRATION IN THE ASSESSMENT YEAR IN QUESTION PARTICULARLY WHEN THE REGISTRATION IS CANCELLED ON 19.07.2010. SECONDLY THE DEPUTY DIRECTOR AGRICULTURE, KISAN UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 9 9 KALYAN AND KRISHI VIKAS VIDE LETTER DATED 10.04.201 3 HIMSELF ADMITTED THAT THE LICENSE CANCELLED ON 19.07.2010 HAVE NO RELEVANCY WITH THE EARLIER YEAR ,P.B. 119. MOREOVER AFTER THE ORDER OF CANCELLATION OF LICENS E DATED 19/07/2010 ALSO THE DDA HAS SANCTIONED AND PAID SUBSIDY TO THE APPELLANT SOCIETY WHICH WILL BE CLEAR FROM THE DDA'S APPROVAL LETTER DATED 28/02/20100 WERE BY SUBSIDY OFRS.3,69,360 WAS SANCTIONED. A COPY OF SAME IS ENCLOSED HEREWITH. IT IS ALSO SUBMITTED THAT AFTER THE INSPECTION THE SEE D WAS SEND TO LABORATORY AND IT WAS FOUND THAT ALL TH E SEED WAS UPTO THE MARK. A COPY OF SAME IS AVAILABLE ON P.B. 118. ( V) THAT IF IT IS PRESUMED THAT THE ASSESSEE HAS VIOLATED THE PROVISION OF SUBSIDY EVEN OTHERWISE DEDUCTION U/S 80P COULD NOT BE DENIED FOR THE SIMPL E REASON THAT THE ASSESSEE HAS NOT VIOLATED ANY UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 10 10 CONDITIONS OF INCOME TAX ACT 1961 OR SECTION 80P BY WHICH THE DEDUCTION IS ALLOWED. (VI) THAT THE ASSESSEE SOCIETY FULFILL ALL THE CONDITIONS MENTIONED U/S 80P(2)(III) WHICH READS AS UNDER:- '80P(2)(III) THE MARKETING' OF AGRICULTURAL PRODUCE GROWN BY THE MEMBERS THE LD. A.O. OR LD. CIT(A) HAS NOT POINTED OUT A SI NGLE INSTANCE WHERE IN THE ASSESSEE SOCIETY HAS PURCHASED THE SOYABEAN SEED FROM ANY PERSON OTHER THAN ITS MEMBER. WITHOUT PREJUDICE TO THE ABOVE, IT IS FURTHER SUBMITTED THAT :- THE LICENSE OF THE SOCIETY WAS CANCELLED MAINLY FOR FOLLOWING REASONS :- (A) AT THE TIME OF INSPECTION STOCK REGISTER WAS NO T FOUND. UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 11 11 (B) THE SECRETARY REFUSED TO GIVE STOCK BOOK AND BILL BOOK IN THE CUSTODY OF INSPECTION TEAM. (C) ABSENCE OF TAG ON POOR QUALITY SEEDS. IT IS SUBMITTED THAT ALL THE ABOVE THREE REASONS DOESN'T AUTHORIZED LD.A.O. TO REJECT ASSESSEE'S CLA IM OF SECTION 80P(2)(III) . HOWEVER IT IS SUBMITTED TH AT IN (A) AND (B) ABOVE ITSELF THERE IS CONTRADICTION. IN (A) IT IS MENTIONED THAT AT THE TIME OF STOCK REGISTER WAS NOT FOUND WHILE IN (B) IT IS MENTIONED THAT STOCK B OOK IS NOT GIVEN IN THE CUSTODY OF INSPECTION TEAM. THU S THE (B) SHOWS THAT THE STOCK REGISTER IS KEPT BUT I T WAS NOT GIVEN IN CUSTODY OF INSPECTION TEAM. AS TO THE CLAUSE (C) IT IS SUBMITTED THAT THERE WAS ABSENCE O F TAG ON POOR QUALITY SEEDS, WHICH IS A TECHNICAL DEFAULT . THERE IS NO ALLEGATION BY INSPECTION TEAM THAT THE POOR QUALITY SEEDS WAS SOLD TO ILLITERATE FARMERS AS ALLEGATED BY THE LD.CIT(A) ON LAST PARA OF PAGE 5. THUS THE ALLEGATION MADE BY THE LD.CIT(A) AND LD.A.O. IS WITHOUT ANY BASIS. UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 12 12 FROM THE ABOVE IT IS CLEAR THAT IF ANY VIOLATION IS MADE BY THE ASSESSEE WHICH IS UNDER THE LAW RELATED TO PRODUCTION AND SALES OF AGRICULTURAL SEED AND NO T OF INCOME TAX ACT OR SECTION 80P(2)(III) OF THE I.T .ACT. IT IS SETTLED LAW THAT THE LD.A.O. AND CIT (A) BE ING QUASI JUDICIAL AUTHORITY CANNOT BASE THEIR CONCLUSION I DECISION ON THE BASIS OF INQUIRY I FINDING OF ANY AUTHORITY UNDER ANY OTHER ACT OR LAW . RELIANCE IS PLACED ON THE FOLLOW ING DECISIONS :- INCOME TAX OFFICER V/S PUKHRAJ N. JAIN, (2006) 99 TTJ 0364 (MUM) IN THE INSTANT CASE THE HON'BLE BENCH HELD AS UNDER:- 21. CONSIDERING THE VARIOUS JUDICIAL PRONOUNCEMENT S AND THE SETTLED LEGAL POSITION, THE CONTENTION OF THE L EARNED DEPARTMENTAL REPRESENTATIVE THAT THE CUSTOMS COLLEC TOR HAVING HAD CONDUCTED THE INQUIRY AND HAVING MARSHALLED/ASCERTAINED THE FACTS AND THEN HAVING PA SSED HIS ORDER UNDER THE CUSTOMS ACT, THE AO, FOR FRAMIN G UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 13 13 ASSESSMENT UNDER IT ACT AND, FOR THAT PURPOSE, FOR MAKING AN ADDITION UNDER S. 69A IN THE HANDS OF THE ASSESS EE (PUKHRAJ JAIN) IN RESPECT OF THE VALUE OF GOLD SEIZ ED FROM KNJ BY CUSTOMS OFFICIALS ON 15TH OCT., 1986, WAS NOT REQUIRED TO MAKE ANY INQUIRY, IN OUR HUMBLE OPINION , SEEMS TO BE MISPLACED/FALLACIOUS, REFLECTIVE OF A N ON- UNDERSTANDING OR MISUNDERSTANDING OF THE VERY BASIC CONCEPT OF JUDICIAL/QUASI-JUDICIAL ADJUDICATION BY A JUDICIAL OR QUASI-JUDICIAL AUTHORITY. IT MAY BE OF SOME BENE FITS TO OBSERVE HERE THAT ALTHOUGH AN AO, WHILE MAKING AN ASSESSMENT, DOES NOT STRICTLY ACT AS A COURT OF LAW , BUT HE ACTS IN A QUASI-JUDICIAL CAPACITY AND THE PROCEEDIN GS BEFORE THE AO ARE, IN GENERAL, IN THE NATURE OF QUA SI- JUDICIAL, THOUGH FOR SPECIFIC PURPOSE, THE SAME ARE 'DEEMED JUDICIAL PROCEEDINGS' AS PROVIDED IN S. 136 OF IT ACT, 1961. AN AO, BEING A QUASI-JUDICIAL AUTHORITY, HAS, WHILE FRAMING ASSESSMENT, TO DISCHARGE HIS DUTY/FUNCTION JUDICIAL LY AND IN THAT PROCESS THE AO HAS TO APPLY HIS OWN MIND INDEPENDENTLY TO THE FACTS OF THE CASE, ASCERTAINED BY HIM AND THEN TO DRAW HIS OWN CONCLUSION/DECISION BY UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 14 14 APPRECIATING THE EVIDENCE/MATERIAL BROUGHT/AVAILABL E ON RECORD BEFORE HIM; THE AO CANNOT BASE HIS CONCLUSION/DECISION ON THE FINDING OF ANY AUTHORITY UNDER ANY OTHER ACT/LAW, AND THUS ADOPT THE FINDING/CONCLUSION OF THAT AUTHORITY. THE DECISION TO BE DRAWN BY THE AO HAS TO BE HIS OWN AND INDEPENDENT O NE. CONTEXTUALLY AND ADVANTAGEOUSLY AS WELL, WE MAY REF ER TO THE PROVISION OF S. 143 (3) WHICH, INTER ALIA, PROVIDES FOR THE FRAMING OF ASSESSMENT AS UNDER: .AFTER HEARING SUCH EVIDENCE AS THE ASSESSEE MAY PRODUCE AND SUCH OTHER EVIDENCE AS THE AO MAY REQUIRE ON SPECIFIED POINTS AND AFTER TAKING INTO A CCOUNT ALL RELEVANT MATERIAL WHICH HE HAS GATHERED. ' THUS, EVIDENTLY AS IT IS CLEAR FROM THE ABOVE QUOTE D STATUTORY PROVISION, THE AO CANNOT BASE HIS DECISIO N ON THE FINDINGS/CONCLUSIONS OF CUSTOMS COLLECTOR DRAWN IN THE ORDER OF CUSTOMS COLLECTOR UNDER THE CUSTOMS ACT. (B)BIMAL KUMAR DAMANI VIS CIT (2003) 261 ITR 635 (C AL.). UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 15 15 (C) DEEPCHAND & CO. VS. ASSTT. CIT (1995) 51 TTJ (BORN) 421. (D) K.T.M.S. MOHD. & ANR. VS, UNION OFINDIA (1992) 108 CTR (SC) 84. (E) MS. REENA H. MIRCHANDANI VS. ASSTT. CIT (2000) 66 TTJ (DEL)(TM) 91 IN VIEW OF ABOVE FACT AND DECISION IT IS PRAYED THA T THE DEDUCTION U/S 80P(2)(III) IS ILLEGALLY DISALLOWED. YOU ARE REQUESTED TO ALLOW THE SAME. 8. ON THE OTHER HAND, THE LD. DR RELIED UPON THE ORDER OF AO AND CIT(A). 9. HAVING HEARD BOTH THE PARTIES, I FIND THAT THE ASSE SSEE IS A COOPERATIVE SOCIETY AND MARKETING CERTIFIED SE ED. THE ASSESSEE SOCIETY IS ENGAGED IN PROCUREMENT OF SOYAB EAN SEEDS WHICH ARE SUPPLIED TO THE MEMBERS OF THE SOCIETY. N O TECHNICAL PROCESSING CARRIED OUT BY THE ASSESSEE SOCIETY. HOW EVER, SEEDS UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 16 16 ARE CLEANED AND GRADED ACCORDING TO THE QUALITY CON TROL. THE WHOLE ACTIVITY IS CARRIED OVER AS PER THE PROVISION S OF VARIOUS ACTS AND THE ASSESSEE RECEIVES SUBSIDY FROM THE DDA . MOREOVER, THE AO HAS VERIFIED THE SALES WHICH IS AN NEXED TO MARKED AS D-1 TO D-4 OF THE WRITTEN SUBMISSION DATE D 20.06.2011 FILED BY THE ASSESSEE. THE ASSESSEE SOCI ETY HAS MADE SALES TO DDA, BETUL, DHAR, KATANI, KHANDWA, KH ARGONE, SHAJAPUR, BADRA, BHIND, WHEREAS THE TERRITORIAL JUR ISDICTION OF THE SOCIETY IS WITHIN THE DISTRICT OF UJJAIN AS PER THE BYE-LAWS OF THE SOCIETY. THUS, THE ASSESSEE SOCIETY HAS VIOL ATED THE BYE- LAWS OF THE SOCIETY. 10. I HAVE GONE THROUGH THE WRITTEN SUBMISSION OF THE ASSESSEE. I FIND THAT DURING THE COURSE OF HEARING, THE LD. AUTHORIZED REPRESENTATIVE DID NOT POINT OUT THAT TH E ASSESSEE HAD ANY JURISDICTION TO SELL THE SEEDS OUTSIDE THE JURISDICTION. I FIND THAT, THEREFORE, THE ASSESSEE HAS VIOLATED THE BYE-LAWS. THEREFORE, IN MY OPINION, THE LICENCE WAS CANCELLED FOR THE SUB SEQUENT YEAR, BUT IN THE YEAR UNDER CONSIDERATION, THE ASSESSEE HIMSELF HAS ADMITTED THAT HE HAS SOLD THE GOODS OUTSIDE THE JURISDICTION OF THE ASSESSEE I.E. OUTSI DE THE UJJAIN UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT, UJJAIN VS . ITO, 1(1), UJJAIN, I.T.A.NO. 592/IND/2014 A.Y. 2009-10 17 17 DISTRICT. THEREFORE, I AM OF THE VIEW THAT THE LD. CIT(A) IS JUSTIFIED IN HIS ACTION AND MY INTERFERENCE IS NOT REQUIRED AT ALL. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMIS SED. THIS ORDER HAS BEEN PRONOUNCED IN THE OP EN COURT ON 21 ST DECEMBER, 2015. SD/- ( D.T.GARASIA) JUDICIAL MEMBER DATED : 21 ST DECEMBER, 2015. CPU*