9911796707
TMI Blog2002 (1) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... ent years 1988-89 and 1989-90. The Assessing Officer, by the said assessment orders, made certain additions in respect of various funds and deposits collected by the respondents out of sugarcane price payable to the cane growers during the course of trading operations. The Commissioner of Income-tax (Appeals) allowed the appeals and set aside the impugned orders impugned therein. The said appellate orders were confirmed by the Tribunal by dismissing the appeals filed by the Revenue holding that the funds/deposits collected by the respective societies, being out of the purchase price payable to the cane growers, were not trading receipts of the assessees. On the aforesaid canvass of the basic facts, the substantial question of law raised by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w the mandate of the Act to which society owes its existence. The directions in this behalf are generally issued through the Director of Sugar, Maharashtra State, Pune. The cane price is decided by the Government. While determining the cane price to be given to the Karkhana, the Government is required to take into account various factors; such as, the amount of actual sugar sold during the sugar year including the value of the closing stock of controlled and free sugar prevailing on the last day of the sugar year. In the present case, the Director of Sugar, Maharashtra State, Pune, issued directions to the sugar factory herein while communicating the final cane price of the sugarcane for the crushing season 1988-89, based on the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e binding directions, issued by the State Government. This court applying the principles of diversion of income by overriding title, held that income having been diverted at source the same was not assess able in the hands of the assessee. For the same reasons, deductions made by the sugar Karkhana from the cane price on account of C. M. relief fund, education fund were also held not to constitute trading receipts of the Karkhana. Some of the items of deductions involved in the present appeals such as Sane Guruji Education Fund and/or factory education fund, flood relief fund, famine relief fund and natural calamities fund were not the subject-matter of scrutiny in the case of CIT v. Chhatrapati Sahakari Sakhar Karkhana Ltd. [2000] 245 IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the hands of the assessee as income. Conclusion: We, for the reasons stated in the case of Chhatrapati Sahakari Sakhar Karkhana Ltd. [2000] 245 ITR 498 (Bom), hold that the deductions on account of education fund, flood relief fund, famine relief fund and/or natural calamities fund are not the trading receipts in the hands of the Karkhana/assessee. Thus, for the reasons stated herein, the question is answered in favour of the assessee and against the Revenue. To this extent, the appeals stand dismissed. Whereas, with respect to the question relating to NRD and interest thereon are concerned, we hold that for the reasons recorded in the case of CIT v. Chhatrapati Sahakari Sakhar Karkhana Ltd. [2000] 245 ITR 498 (Bom), the deduction of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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