2021 (8) TMI 99

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....return of income for A.Y. 2012-13 was filed on 30.09.2012 which was revised on 18.05.2013 at a total income of Rs. Nil. Against the said return of income, the assessment was completed by the Assessing Officer vide order dated 24.03.2015 passed u/s 143(3) of the Income Tax Act (hereinafter referred as "the Act") at a total income of Rs. 24,49,10,402/-. While doing so, the Assessing Officer disallowed a sum of Rs. 24,35,03,348/- being the excess cane price paid to sugarcane growers / members. According to the Assessing Officer, the sugarcane price paid by the respondent / assessee over and above the Fair Remunerative Price (FRP) fixed and notified by the Government is nothing but appropriation of profits which is not allowable as an expenditu....

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....ted 10.10.2017 issued by CBDT. Accordingly, the ld.CIT(A) had held that only the balance amount of Rs. 175.40 per M.T. should be disallowed. While doing so, the ld.CIT(A) has taken the F.R.P. price at Rs. 1,511.20 per M.T. as against the actual price paid at Rs. 1,686.60 M.T. Accordingly, deleted the addition to an extent of Rs. 18,32,82,389/-. 4. Being aggrieved by the decision of ld.CIT(A), the Revenue is in appeal before us. 5. It is contended by the ld.CIT D.R. that ld.CIT(A) ought not have allowed the relief given on harvesting and transport expenses which is already included as a part of the F.R.P. Thus, he submitted that the order of ld.CIT(A) is contrary to the law and cannot be sustained in the eye of law. 6. On the other hand,....

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....ave disallowed the claim of harvesting and transportation expenses incurred by the co-operative sugar mills for procuring sugarcane from farmers, who are members of such co-op. sugar mills and who are bound under agreement to supply the sugarcane exclusively to the concerned sugar mill. The issue of allowability of such expenses has been examined by the Board. These expenses are incurred by the sugar mills for ensuring an adequate and sustained supplier of freshly cut sugarcane i.e. an essential input for the continuous running of such mills. These expenses are therefore incurred for a commercial expediency and are prima facie wholly and exclusively for the purpose of business. Such expenses are therefore allowable in the computation of ....