9911796707
TMI Blog1983 (6) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... 3,83,006 u/s 80J made by the appellant. 2. The assessee is a co-operative society engaged in the manufacture and sale of white sugar from sugarcane. The assessee also derives income from the sale of by-products of sugar, interest income, income from vehicle owned by it and other miscellaneous income. The assessment year is 1974-75 and the relevant previous year ended on 3rd Jun, 1973. 3. In order to better appreciate the rival submissions of the parties, it would be necessary to produce below income of Rs. Nil determined by the ITO: Rs. Rs. Net Profit as per accounts . 14,96,631 Less : Profit on sale of car and jeep treated separately . 7,008 . . 14,89,62 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Similarly, the ITO had disallowed the assessee's claim for deduction of Rs. 2,728 u/s 80G of the Act. It may be mentioned that the assessee had claimed deduction u/s 80J of the Act, of a sum of Rs. 13,83,006. In order to arrive at the capital employed by it, the assessee had also considered bank loan of Rs. 2,06,03,495. The ITO, however, was of the view that the loan taken by the assessee cannot be considered as "capital employed" in view of the provisions of s. 80J of the Act and the rules made thereunder. 4. In appeal, the CIT(A) upheld the action of the ITO. 5. Being aggrieved by the order of the CIT(A), the assessee has come up in appeal before the Tribunal. The ld. counsel for the assessee submitted that in view of the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counsel for the assessee submitted that in view of he decision of the Hon'ble Bombay High Court in the case of CIT vs. Smt. Godavaridevi Saraf (1978) 113 ITR 589 (Bom), the Tribunal is bound to follow the said decision in the case of Katpadi Coop. Timber Works Ltd. He, therefore, urged that we should accept the assessee's claim for deduction u/s 80P of the Act. 6. the ld. representative for the Department, on the other hand, strongly supported the orders of the IT authorities by relying on the decision of the Hon'ble Gujarat High Court in the case of CIT vs. Amul Transmission Line Hardware (P) Ltd. (1976) 104 ITR 771 (Guj) and CIT vs. Gautam Sarabhai (1981) 129 ITR 133 (Guj) as well as of the Hon'ble Bombay High Court in the case of Asia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e should uphold the order of the CIT(A) on this point. 7. We have considered the rival submissions of the parties and in view of the decision in the case of Katpadi Co-op. Timber Works Ltd. we find considerable force in the submissions made on behalf of the assessee. Since the IT Act is an All India Stature, it would be advisable to give uniform interpretation of the provisions of the Act. It is no doubt true that the decision of the Hon'ble High Court other than the Hon'ble Gujarat High Court is not binding on us however, if there is not direct decision of the Hon'ble Gujarat High Court on the provisions of s. 80P of the Act, and if no other decision of Hon'ble High Court is available taking a contrary view to the one taken by the Hon'b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o any reasoning which is not warranted by the nature of the provision. So long as the gross total income included the amount of income referable to the activities of the co-operative societies by s. 80P (2) (c), the assessee would be eligible for the deduction, and, if there is any amount left thereafter that could be the subject of consideration for adjustment of carried forward losses or other items which would require to be considered. We, therefore, answer the question referred to us in the affirmative and in favour of the assessee. The assessee will be entitled to its costs." Respectfully following the aforesaid decision, we would direct the ITO to accept the assessee's claim made u/s 80P (2) of the Act and modify the assessment acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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