AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (3) TMI 801
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....le of sugar on concessional rate and ignoring the fact that the Hon'ble ITAT vide various decisions has restored the issue to the file of the AO. 2. On facts and in the circumstances of the case and in law, the ld.CIT(A) erred in not appreciating the fact that in assessee's own case for AY 2015-16, the Hon'ble ITAT has restored the issue to the file of AO by following the Coordinate Bench of Pune Tribunal's decision in the case of Shri Adinath SSK Vs. ACIT, which in turn has relied on the coordinate bench of Tribunal in the case of ACIT Vs. Shri Shankar SSK Ltd. 3. On facts and in the circumstances of the case and in law, the ld.CIT(A) erred in not appreciating the fact that, coordinate Bench of Tribunal in the case of ACIT Vs. Shri Shankar SSK Ltd. has duly considered both the cases as relied upon by the CIT(A) viz. the decision of Hon. ITAT in the case of Chhatrapati Shahu SSK and decision of Hon. Bombay HC in the case of CIT Vs. Terana SSK and then only restored the issue of sale of sugar to members at concessional rate to the file of the AO. 4. The appellant craves leave to add, alter, amend and modify any of the above or all grounds raised at time of....
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....t in the case of Assessee in Income Tax Appeal(Lodg.) No.2726 of 2009, dated 01.02.2010. 3.1 Ld.AR submitted that the issue had attained finality by Hon'ble Bombay High Court's order in assessee's own case in Income Tax Appeal(Lodg.) No.2726 of 2009, dated 01.02.2010 vide which Hon'ble Bombay High Court dismissed the appeal of the Revenue. Ld.AR further submitted that Revenue has not filed any SLP against the decision of Hon'ble Bombay High Court regarding sale of sugar at concessional rate. Therefore, ld.AR pleaded that this issue has attained finality for the assessee. Findings & Analysis : 4. We have heard both the parties and perused the records. With the consent of both the parties, these appeals were heard together as the issue involved is same, grounds of appeal raised are same. We took appeal for A.Y.2007-08 as lead appeal. 4.1 Assessee is a Co-operative Society. Assessee filed Return of Income on 30.10.2007 disclosing total income at Rs. NIL and claiming carry forward losses of earlier years of Rs. 7,64,55,198/-. Then, assessee filed a revised Return of Income on 26.03.2009 increasing the losses to Rs. 7,82,30,508/-. The Assessee's case was selected for scrutin....
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.... on 25.09.2019 and decided vide order dated 01.10.2019 by a common order consisting of 75 appeals. 4.4 All these appeals were decided by ITAT Pune by a common order along with other cases. The Assessing Officer in assessment order for A.Y.2007-08 dated 28.09.2021 has referred wrong ITA Appeal Numbers. The ITAT vide its common order 14.03.2019, 01.05.2019 and 01.10.2019set-aside the issue to the Assessing Officer, following the decision of Hon'ble Supreme Court in the case of CIT Vs. Krishna Sahakari Karkhana Limited [2012] 27 taxmann.com 162 (SC) order dated 25.09.2012. The ITAT directed Assessing Officer to verify following aspects : * Whether practice of selling sugar at concessional rate is a custom in the Co-operative Sugar Industry! * Whether any resolution has been passed by State Government supporting the practice! * What is the basis of quantity fixed for sale at concessional rate? 4.5 The ld.Assessing Officer in his order dated 28.09.2021 for A.Y.2007-08 has reproduced the above mentioned directions, however, ignored to follow the direction. The Assessing Officer has not bothered to give finding on any issue mentioned by ITAT for which it w....
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....de. Revenue relied on the Circular of the Maharashtra Sugar Commissioner who has laid down specific criteria and also fixed the rate and quantity which can be given to members. Revenue has referred certain case laws in the grounds of appeal without quoting citation. 4.9 It is noted that ld.AR submitted that it is a customary practice to sale sugar at concessional rate to the Farmers who sell sugar cane to Assessee. Ld.AR further submitted that this is a practice followed by all sugar factories. Ld.AR also submitted that Assessee has passed a resolution to that effect. Ld.AR filed copy of the resolution dated 14.02.1990 in paper book. As per the said resolution of the Assessee-Factory, concessional sugar is given only to the members. Therefore, Assessee has not explained how concessional sugar has been provided to non-members. Ld.AR also submitted that even State Government has approved the said practice. Ld.DR has not rebutted these submissions of the ld.AR. We have observed that indeed it is a customary practice among all sugar factoriesin this belt to sale sugar at concessional rate to Farmers. However, nowhere the exact number of members to whom sugar has been sold at concess....
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....e cases to CIT(A) to de-novo consider the matter." Unquote 4.11 In this context, it is important to refer to the circular of the Sugar Commissioner - Maharashtra State vide Circular No:"Outward No:CS/Admin-1/Circular/05 dated 01.03.2006". The Sugar Commissioner Maharashtra State has elaborately discussed the sale of sugar at concessional rate and given directions. The said circular is reproduced as under : "Commissioner of Sugar Maharashtra Rajya SakharSankul, Shivaji Nagar, Pune-5 Outward No:CS/Admin-1/Circular/05 Date:01st Date March, 2006 CIRCULAR Sub: Sale of Sugar at concessional rate to members and employees of sugar factories of State To give directions as per section 79A of the Maharashtra Co-operative Societies Rules, 1960 Ref: Govt. Letter SSK1005/25859/Letter No. 345/25S dated 14th February, 2006 Terms and conditions and procedure to be followed for sale of sugar at concession rate was fixed through Circular from this office dated 13th April, 2005 and 27th May, 2005. However, some of the factories....
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....y shall sell maximum 5 kg sugar per month at concession rate to its member. 4. This concession will be limited only to the members and employees. 5. If a factory has crushed less than 50% in the previous season, then it will not be eligible for concession sale of sugar. 6. The sale of sugar at concession shall be applicable only to those members who have supplied their cane to factory as per the rules of the factory." 4.12 The Sugar Commissioner Maharashtra Government gave the directions to all sugar factories as per Section 79(A) of Maharashtra Co-operative Societies Act, 1960. The Sugar Commissioner gave the direction that Sugar Factories shall sale maximum 5 kgs of sugar per month at concessional rate to its members only. The rate shall be @ levy sugar (+) excise duty. The sale of sugar at concessional rate shall be applicable only to those members who have supplied their Sugar Cane to the factory. 4.13 The Hon'ble Supreme Court in the case of Krishna SSK Ltd.,(supra) had set-aside the issue with specific direction. Accordingly, ITAT had directed Assessing Officer to verify the issue as per the directions of Hon'ble Supreme Court. One of the Dire....
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.... (3) Where the Registrar is satisfied that any person was responsible for complying with any directions or modified directions issued to a society under sub-sections (1) and (2) and he has failed without any good reason or justification, to comply with the directions, the Registrar may by order - (a) if the person is a member of the committee of the society, remove the member from the committee and appoint any other person as a member of the committee for the remainder of the term of his office and declare him to be disqualified to be such member for a period of six years from the date of the order, (b) if the person is an employee of the society, direct the committee to remove such person from employment of the society forthwith, and if any member or members of the committee, without any good reason or justification, fail to comply with this order, remove the members, appoint other persons as members and declare them disqualified as provided in clause (a) above: Provided that, before making any order under this sub-section, the Registrar shall give a reasonable opportunity of being heard to the person or persons concerned and consult the federal soc....
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....bonus (which is in the nature of deferred discount) passed on by the consumer co-operative stores to their members on the value of the purchases made by them during a year should be allowed as a deduction in computing the business income of such a society." 4.17 Thus, the Circular dated 22.08.1973 is regarding consumer co-operatives stores, granting certain rebates on purchases, whereas in the case of assessee, the issue is sale of sugar at concessional rate. 4.18 Also, the Hon'ble Bombay High Court in the case of Terana Sahakari Sakhar Karkhana Ltd(supra) decided the appeal in February, 2006 when this circular of Commissioner of Sugar Maharashtra State, dated 01.03.2006 was not applicable. Therefore, the Hon'ble Bombay High Court's decision in the case of Terana SSK Ltd.,(supra) is distinguishable on facts and hence not applicable in the case of assessee. Therefore, ld.CIT(A) has erred in deciding the appeal following Hon'ble Bombay High Court's decision in Terana SSK Ltd and not referring to the decision of Hon'ble Supreme Court in the case of Krishna SSK Ltd.,(supra). Ld.CIT(A) erred in not appreciating the fact that this was the Assessment Order in consequence to ITAT Dec....