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

MA 52/IND/2016

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 4974 (ITAT-INDORE)
• Duration Of Justice: 4 month(s) 28 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-10-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 23-05-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED

Judgement Text

MA NO. 52/IND/2016 M/S UJJAIN BEEJ UTPADAK SAH.MARYADIT 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE .., ..!', #$ # !% BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER M.A. NO. 52/IND/2016 ARISING OUT OF I.T.A. NO.52/IND/2016 ASSESSMENT YEAR: 2009-10 M/S UJJAINI BEEJ UTPADAK SAHAKARITA MARYADIT UJJAIN PAN AABFC 8607N :: APPELLANT VS INCOME TAX OFFICER 1(1) UJJAIN :: RESPONDENT /APPELLANT BY SHRI PRAKASH JAIN RESPONDENT BY SHRI MOHD. JAVED ! DATE OF HEARING 23.9.2016 '#$% ! DATE OF PRONOUNCEMENT 20.10.2016 ' O R D E R PER SHRI D.T. GARASIA, JM THIS MISCELLANEOUS APPLICATION IS FILED BY THE ASSESSEE ON THE GROUND THAT WHILE DECIDING THE APPEAL, THE HON 'BLE BENCH HAS DECIDED THE ISSUE ON THE GROUND THAT THE MA NO. 52/IND/2016 M/S UJJAIN BEEJ UTPADAK SAH.MARYADIT 2 ASSESSEE HAD NO JURISDICTION TO SELL THE SEEDS OUTSID E THE JURISDICTION AND IF THE ASSESSEE HAS SOLD ITS GOODS, I T IS VIOLATION OF BYE-LAWS. THEREFORE, DEDUCTION U/S 80O( 2)(III) OF THE ACT WAS NOT ALLOWED BY THE REVENUE AUTHORITIES. THEREFORE, THE APPEAL WAS DISMISSED. 2. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT WHILE DECIDING THIS APPEAL, THE TRIBUNAL HAS OVERLOOKED THE JURISDICTION OF THE SOCIETY AND AS PE R THE BYE-LAWS, THERE IS NO PROHIBITION PROVIDED IN THE A CT THAT THE SOCIETY CANNOT SELL THE GOODS OUTSIDE UJJAIN. MOR EOVER, IN THE BYE-LAWS IT IS STATED THAT THE JURISDICTION OF THE SOCIETY IS LIMITED TO MEMBERSHIP OF THE SOCIETY AND NOT THE SALE AND DISTRIBUTION OF THE SOCIETY, THEREFORE, THE BYE-LAWS DID NOT PROHIBIT THE ASSESSEE SOCIETY TO SELL THE GO ODS OUTSIDE THE JURISDICTION. THEREFORE, THE MISCELLANEO US APPLICATION MAY BE ALLOWED. MA NO. 52/IND/2016 M/S UJJAIN BEEJ UTPADAK SAH.MARYADIT 3 3. ON THE OTHER HAND, THE LEARNED DR RELIED UPON THE SAME SUBMISSIONS AND SUBMITTED THAT THE BYE-LAWS OF TH E SOCIETY SPEAK THAT THE ASSESSEES JURISDICTION IS ONLY UJJAIN DISTRICT AND IT CAN TAKE ONLY THE MEMBERS FROM UJJAIN DISTRICT AND THE SOCIETY HAS TO DISTRIBUTE SEEDS TO T HE RESPECTIVE MEMBERS ONLY. THEREFORE, THERE IS NO AMB IGUITY IN THE ORDER OF THE TRIBUNAL. THE MISCELLANEOUS APPLI CATION MAY, THEREFORE, BE DISMISSED. 4. WE HAVE HEARD THE RIVAL CONTENTIONS OF THE PARTIES. WE HAVE ALSO GONE THROUGH THE BYE-LAWS OF THE SOCIETY AND THE BYE-LAWS OF THE SOCIETY SAY THAT THE ASSESSEE SOCIETY IS A COOPERATIVE SOCIETY ENGAGED IN PRODUCTION AND MARKETING OF CERTIFIED SEEDS. THE SOCIETY IS ENGAGED IN THE PROC UREMENT OF SOYABEAN SEEDS FROM ITS MEMBERS WHICH ARE SUPPLIED TO THE MEMBERS OF THE SOCIETY ONLY. NO TECHNICAL PROCES SING HAS BEEN CARRIED OUT BY THE SOCIETY BUT THE SEEDS ARE MA NO. 52/IND/2016 M/S UJJAIN BEEJ UTPADAK SAH.MARYADIT 4 CLEANED AND GRADED ACCORDING TO THE QUALITY AND THE WHOLE ACTIVITY IS CARRIED OUT AS PER THE PROVISIONS OF VARIOU S ACTS. DURING THE FINANCIAL YEAR THE ASSESSEE HAS RECEIVED THE SUBSIDY OF RS.16,75,849/-. WE FIND THAT AS PER THE ACT, THESE ACTIVITIES HAVE TO BE CARRIED OUT ONLY IN UJJAIN DISTRICT AND THE COOPERATIVE SOCIETY HAS TO PROCURE THE SOYABEAN SEEDS FROM ITS MEMBERS ONLY AND IT IS TO BE SUPPLIED TO MEMBERS OF THE SOCIETY ONLY. THE SOCIETY IS NOT PER MITTED TO PROCURE THE SOYABEAN SEEDS FROM OUTSIDE THE MEMBERS O F THE SOCIETY. SIMILARLY, THE SOCIETY IS NOT PERMITTED TO SELL THE SOYA SEEDS TO ANYBODY EXCEPT UJJAIN BEEJ SANGH SOCIETY. IN THE INSTANT CASE, IF THE ASSESSEE HAS SOLD THE SOYABEAN SEEDS OUTSIDE THE JURISDICTION OF UJJAIN THE N IT IS VIOLATION OF BYE-LAWS AND THE COOPERATIVE SOCIETY HAS NO JURISDICTION TO SELL THE SOYABEAN SEEDS OUTSIDE UJJAIN DISTRICT. IF THE UJJAIN COOPERATIVE SOCIETY SELLS TH E SOYABEAN MA NO. 52/IND/2016 M/S UJJAIN BEEJ UTPADAK SAH.MARYADIT 5 SEEDS TO NON-MEMBERS AND OUTSIDE THE UJJAIN DISTRICT THEN THIS ACTIVITY IS NOT CARRIED OUT AS PER M.P. COOPERATIV E ACT. THE BASIC CONCEPT OF DEDUCTION U/S 80O(2)(III) OF TH E ACT IS TO PROMOTE THE COOPERATIVE MOVEMENT AND TO GIVE ITS MEMBERS THE BENEFIT OF COOPERATION AND THEY MAY NOT SUBJECT TO ANY UNNECESSARY EXPENSES OF THEIR MEMBERS, THEREFORE, THE GOVERNMENT WAS CONSCIOUS TO PROMOTE THE COOPERATIVE MOVEMENT. THEY WERE GIVEN SUBSIDY TO CARR Y OUT THIS MOVEMENT AND IF THEY COLLECT SOYABEAN SEEDS AN D SELL THE SAME OUTSIDE UJJAIN, IT TANTAMOUNTS TO VIOLATIO N OF UJJAIN BEEJ UTPADAK SAHKARI MANDIYA BYE-LAWS. WE ALSO OBSERVE THAT THE SOCIETY IS CREATED BY M.P. COOPERATIV E SOCIETIES ACT AND IT IS GOVERNED BY THAT ACT. THEREF ORE, AS PER THE ADMISSION OF THE ASSESSEE, IT HAS SOLD THE SEE DS OUTSIDE THE JURISDICTION, THEREFORE, THE ASSESSEE SO CIETY IS NOT ELIGIBLE FOR DEDUCTION U/S 80P(2)(III) OF THE A CT. MA NO. 52/IND/2016 M/S UJJAIN BEEJ UTPADAK SAH.MARYADIT 6 5. IN THE RESULT, THE MISCELLANEOUS APPLICATION IS DISMISSED. THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON 20 OCTOBER, 2016. SD/- SD/- ( ..!') (..) #$ ( (O.P.MEENA) (D.T.GARASIA) ACCOUNTANT MEMBER J UDICIAL MEMBER (') / DATED : 20 OCTOBER, 2016. DN/ MA NO. 52/IND/2016 M/S UJJAIN BEEJ UTPADAK SAH.MARYADIT 7