https://www.taxtmi.com/caselaws?id=796575 Excess sugarcane price paid by a co-operative sugar factory to member suppliers under Section 37(1) requires disallowance only to the extent the payment contains a profit-embedded component. The prescribed approach compares the rate paid to members with the commercial benchmark represented by payments to non-members or outsiders, calculates the differential for cane procured from members, and permits reduction where contemporaneous evidence shows that the differential reflects commercial factors such as quality or recovery rather than membership. As the necessary computations and evidence were unavailable, the Assessing Officer must recompute the disallowance using this methodology. en-us Fri, 23 Jan 2026 00:00:00 +0530 Fri, 07 Aug 2026 09:07:33 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=796575 Excess sugarcane price paid by a co-operative sugar factory to member suppliers under Section 37(1) requires disallowance only to the extent the payment contains a profit-embedded component. The prescribed approach compares the rate paid to members with the commercial benchmark represented by payments to non-members or outsiders, calculates the differential for cane procured from members, and permits reduction where contemporaneous evidence shows that the differential reflects commercial factors such as quality or recovery rather than membership. As the necessary computations and evidence were unavailable, the Assessing Officer must recompute the disallowance using this methodology. Case-Laws Income Tax Fri, 23 Jan 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=796575