Allowability of sugarcane price paid over and above FRP price

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE (Through Vi rtual Court) BEFORE SHRI INTU RI RAMA RAO, AM AND SHRI S. S. VISWANETHRA RAVI, JM

ITA Nos.1784 & 2227/PUN/2017
Assessment Years : 2014-15 & 2013-14

Padamshree Dr. D. Y. Patil
Sahakari Sakhar Karkhana Ltd.,
Tal. Vesraf Palsamle, P. Aslat,
Tal. Gaganbawada, Kolhapur.
PAN : AAAAS6831N

Appellant

VS

ACIT, Circle-1,
Kolhapur.

Respondent

Assessee by : Shri M. K. Kulkarni
Revenue by : Shri Deepak Garg

Date of Hearing : 09.06.2021

Date of Pronouncement : 26.07.2021

ORDER

These are the appeals filed by the assessee directed against thevseparate orders of ld. Commissioner of Income Tax (Appeals)- 1/2, Kolhapurv(‘CIT(A)’ for short) dated 04.05.2017 and 21.07.2017 for the assessment years 2014-15 and 2013-14 respectively.

2. Since the identical facts and issues are involved in both the appeals, we proceed to dispose of the appeal through this consolidated order for the sake of convenience.

3.Being aggrieved, an appeal was preferred before the ld. CIT(A) who vide impugned order confirmed the addition after adverting to the scheme of fixation of price and purchase of sugarcane and held that the excess price paid is nothing but appropriation of profits. Similarly, the ld. CIT(A) also confirmed the addition on account of sale of sugar at concessional price after referring to the decision of the Hon’ble Supreme Court in the case of CIT vs. Krishna Sahakari Sakhar Karkhana, 211 taxmann.com 109 (SC).
4. It is submitted that Review Petition is pending before the Hon’ble Supreme Court against the decision in the case of CIT vs. Tasgaon Taluka Sahakari Sakhar Karkhana Ltd., 412 ITR 420. It is further submitted that the FRP price fixed by the Central Government in connotation with stake holder. Therefore, it cannot be termed as unreasonable.

5. Since the facts and issues involved in both the appeals are identical, therefore, our decision in appeal of the appellant in ITA No.1784/PUN/2017 for the assessment year 2014-15 shall apply mutatis mutandis to the appeal of the appellant in ITA No.2227/PUN/2017 for the assessment year 2013-14. Thus, the appeal of the appellant in ITA No.2227/PUN/2017 for the assessment year 2013-14 is partly allowed for statistical purposes.
6. Resultantly, both the appeals of the assessee are partly allowed for statistical purposes.

Order pronounced on this 26th day of July, 2021.

Please find attached the enclosed file for the full judgement