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TMI Blog2019 (5) TMI 780X X X X Extracts X X X X X X X X Extracts X X X X ..... condonation of delay. We are satisfied with such reasons. As such, the delay is condoned and the cross objection filed by the assessee is admitted for hearing on merits. 3. The first issue raised in the assessee's cross-objection vide ground nos. 2 to 4 is against the sustenance of addition towards excessive sugarcane price paid to members as well as nonmembers of the assessee. 4. Briefly stated, the facts of the case are that the assessee is a Co-operative Society engaged in the business of manufacturing and sale of sugar and its bye-products. During the course of assessment proceedings, the AO observed that the assessee paid excessive cane price, over and above the Fair and remunerative price (FRP) fixed by the Government, to its membe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hased and crushed sugarcane and paid price for the purchase during crushing season 2009-10, firstly, at the time of purchase of sugarcane and then, later, as per the Mantri Committee advice. It further noted that the production of sugar is covered by the Essential Commodities Act, 1955 and the Government issued Sugar Cane (Control) Order, 1966, which deals with all aspects of production of sugarcane and sales thereof including the price to be paid to the cane growers. Clause 3 of the Sugar Cane (Control) Order, 1966 authorizes the Government to fix minimum sugarcane price. In addition, the additional sugarcane price is also payable as per clause 5A of the Control Order, 1966. The AO in that case concluded that the difference between the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the modalities and manner in which SAP/additional purchase price/final price is decided. He has been directed to carry out an exercise of considering accounts/balance sheet and the material supplied to the State Government for the purpose of deciding/fixing the final price/additional purchase price/SAP under clause 5A of the Control Order, 1966 and thereafter determine as to what amount would form part of the distribution of profit and the other as deductible expenditure. The relevant findings of the Hon'ble Apex Court are reproduced as under:- "9.4. ..... Therefore, to the extent of the component of profit which will be a part of the final determination of SAP and/or the final price/additional purchase price fixed under Clause 5A would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ponent is to be considered as sharing of profit/distribution of profit and the rest of the amount is to be considered as deductible as expenditure." 6. Both the sides are unanimously agreeable that the extant issue of deduction for payment of excessive price for purchase of sugarcane, raised in the appeal under consideration, is squarely covered by the aforesaid judgment of the Hon'ble Supreme Court. Respectfully following the precedent, we setaside the impugned order on this score and remit the matter to the file of the A.O for deciding it afresh as per law in consonance with the articulation of law by the Hon'ble Supreme Court in the aforenoted judgment. 7. At this stage, it is made clear in so far as the non-members are concerned, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Hon'ble Summit Court remitted the matter to the CIT(A) for considering, inter alia,: "whether the abovementioned practice of selling sugar at concessional rate has become the practice or custom in the Co-operative sugar industry?; and whether any Resolution has been passed by the State Government supporting the practice?; The CIT(A) would also consider on what basis the quantity of the final product, i.e. sugar, is being fixed for sale to farmers/cane growers/Members each year on month-to-month basis, apart from others from Diwali?" The issue under consideration can be decided by an appropriate lower authority only on the touchstone of the relevant factors noted in the above judgment. In our considered opinion, it would be just and fai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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