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2022 (9) TMI 548 - AT - Income TaxExcess cane price paid to members/non members as well as sale of sugar at concessional rate - HELD THAT:- Issues are no more res-integra as the tribunal’s coordinate bench’s recent order in The Malegaon Sahakari Sakhar Karkhana Ltd. [2021 (10) TMI 1357 - ITAT PUNE] has restored the same back to the Assessing Officer for his afresh appropriate adjudication. Ordered accordingly. This assessee’s former twin substantive ground Nos. 1 & 2 are allowed for statistical purposes on the very terms. Addition u/s 40(A)(3) - cash payment disallowance made by the assessee to it’s employees - HELD THAT:- As case law Anupam Teleservices Ltd. [2014 (2) TMI 30 - GUJARAT HIGH COURT] has dealt with the similar question of regular & continuing relationship between payer and payee to conclude that such an overwhelming genuine instance of cash payment does not attract Section 40A(3) of the Act. We thus conclude that both the lower authorities have erred in law and on facts in disallowing assessee’s impugned salary payments under Section 40A(3) of the Act. The same is directed to be deleted. Addition of “Bigar Pavati Kharch” expenses - As argued that the assessee could not file even basic supportive documents and expenditure vouchers in support of the impugned claim - HELD THAT:- This assessee is running a sugar factory procuring sugarcane from remote rural areas involving various overhead expenses. That being the case, such cash expenditure cannot be altogether ruled out. We also deem it appropriate to observe that it was indeed imperative for the assessee as well to file at least some supportive documentary evidence. Faced with this situation, we hold that a lump sum disallowance @ 20% of the assessee’s impugned claim would be just and proper with a rider that the same will not be treated as a precedent. Ordered accordingly. The assessee partly succeeds in the instant substantive ground. Cattle camps/fodder depot income made in the course of assessment - HELD THAT:- All Revenue’s arguments failed to evoke our concurrence. It has come on record that the impugned surplus had come to the assessee from the fodder grants received from the state government without any clear cut indication about the income element embedded therein. We thus quote Chaiunrup Sampatram [1953 (10) TMI 2 - SUPREME COURT] that the principles of conservative accountancy indeed permit an assessee to recognise the anticipatory losses at the first sign of reasonable probability but the same principle does not apply regarding anticipated profits which have to be booked at the first sign of reasonable certainty only. Faced with this situation, we conclude that both the lower authorities have erred in law and on facts in making the impugned cattle camps/fodder depot addition in assessee’s hands. The same is directed to be deleted.
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