Deferred discount treatment for concessional sugar sales upheld; no real income accrued on the price difference.

Concessional sale of sugar to cane growers was held not to give rise to any real income for tax purposes where the difference from market price was treated consistently with CBDT Circular No. 117 as a deferred discount or business deduction. The Court found that the attempt to distinguish the facts did not alter the governing legal position, and the Tribunal was justified in deleting the addition. The Revenue's challenge therefore failed, and the deletion of the addition remained undisturbed.

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Issues: Whether the Tribunal was justified in deleting the addition made on account of the difference between the market price of sugar and the concessional price at which sugar was sold to cane growers, and in holding that no real income accrued to the assessee on such concessional sales.

Analysis: The Court noted that an identical question had earlier been dealt with on the basis of CBDT Circular No. 117 dated 22.08.1973, which treats rebate or bonus passed on by cooperative stores to members as a deferred discount allowable as a business deduction. It found that the circular applied to the present case and that the attempt to distinguish the facts did not alter the legal position.

Conclusion: The Tribunal's view was upheld and the Revenue's challenge failed; the addition was not sustainable.

Final Conclusion: The appeal was dismissed for want of a substantial question of law, leaving the Tribunal's deletion of the addition undisturbed.

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