2022 (11) TMI 1132

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....er referred to as 'the Act') relating to the A.Y. 2015-16. 2. The brief facts of the case the assessee is a Co-operative Society registered under Gujarat Co-operative Society Act engaged in collection of Milk from local small milk producers and supply to SNR District Milk Producers Union. The assessee filed its return of income for the A.Y. 2014-15 on 13.09.2015 declaring total income of Rs. NIL. During scrutiny assessment proceedings the Assessing Officer noticed that the assessee had paid Rs. 2,25,48,312/- for purchase of milk to one of its member Shri Raghubhai Algotar. Hence, his statement was recorded under Section 131 of the Act on 13.11.2017, whereas he has stated the sale of milk was hardly Rs. 15,000/- per month from the members....

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....me Court judgment in case of CIT vs. Smt. Sunita Dhadda (SLP (Civil) Diary No. 9431/2018) dated 28.03.2018. However, the Ld. CIT(A) without going into the statement recorded of Shri Karsanbhai Bharwad and furnishing of copies to the assessee and providing cross-examination but dealt with the case on merits relying upon Section 80P(2)(b) and held that the condition to get eligible for deduction, Produce has to be raised by members, which is not satisfied in assessee's case, since the profit is attributable also to purchase of milk from non-members. Therefore, the disallowance made by the AO does not require any interference and thereby confirmed the assessment order. 4. Aggrieved against the same the assessee is before us raising the foll....

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....from non-members at 56 % and thereby disallowing deduction to that extent. The entire working made by AO is erroneous. It is therefore prayed that the disallowance of deduction u/s 80P(2)((b) of Rs,6,80,976/-made by the AO should be deleted." 5. None appeared on behalf of the assessee, even in the previous five hearings none appeared on behalf of the assessee in spite of service of notices. So, with the help of the Ld. Sr. D.R. Mr. B. D. Gupta, we proceed to dispose of this appeal. The Ld. D.R. submitted that the statement recorded under Section 131 of the Act from Shri Karshanbhai Bharwad who is a Mantri of the assessee co-operative society, wherein he has clearly admitted the milk was procured from its members as well as non-m....