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2011 (11) TMI 371 - HC - Income TaxApplicability of provisions of Section 40A(3) to the purchase of stock-in-trade – Benefit of Rule 6DD to payment made to M/s Hoshiarpur District Cooperative Milk Producers Union Ltd - Held that:- When moneys are paid/spent for purchase of stock-in-trade then also the provisions of Section 40A(3) will apply since this amounts to expenditure – Decided against the Assessee. Benefit of Rule 6DD is available if the payment is made to the grower or producer of such articles - It is apparent from Model Bye-laws of society it is only the registered milk producers’ society and the State Government, which can be the members of the Union. The constitution of the Union does not permit individual producers to be its members. Therefore, the Union, by no stretch of imagination, can be considered to be a producer of the milk. Therefore, benefit of rule 6DD is not available - Decided against the Assessee.
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