2001 (11) TMI 17 - HC - Income Tax

Co-operative Society, Business Expenditure - Whether, Tribunal was right in deleting the additions made by the Assessing Officer on account of non-refundable deposits, interest paid/payable on non-refundable deposits by holding that various funds/deposits collected by the assessee-society out of sugarcane purchase price payable to the cane growers are not the trading receipts of the assessee - Whether, Tribunal is right in deleting the disallowance of Rs. 1,80,359 out of advertisement expenses on account of subhechcha greetings holding that expenditure was necessary to maintain cordial relations with the members and ignoring that the expenses were not to advertise the product of the assessee and such expenses are not required considering the product of the assessee? - question No. 1 is answered in favour of the Revenue and against the assessee, whereas questions Nos. 2 answered in favour of the assessee and against the Revenue.

Summary

The High Court of Bombay heard a case where three questions were raised regarding non-refundable deposits, excess price of cane sugar, and advertisement expenses. The court found that question 1 was answered in favor of the Revenue, while questions 2 and 3 were answered in favor of the assessee. The appeal was allowed partly for question 1 and dismissed for questions 2 and 3 with no order as to costs.