TMI Blog2005 (9) TMI 590X X X X Extracts X X X X X X X X Extracts X X X X ..... er in view of the facts and circumstances of the case, the sum of Rs.2,95,201/- credited to Molasses Storage Maintenance Fund a/c was the income of the assessee? 2. Whether the Tribunal is correct in law in allowing the deduction of Rs.2,29,076/- on account of interest on excess levy sugar price? We have heard Sri S.D. Singh, learned counsel for the assessee and Sri Shambhu Chopra, learned Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l order issued from time to time by the Molasses Controller. It is further submitted that clause 3 of The Molasses Control (Regulation Of Fund For Erection Of Storage Facilities) Order, 1976 provides about the maintenance of the funds and the said fund is to be utilized only for the maintenance of adequate storage facilities with the permission of the Molasses Controller. It is pointed out that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Controller. The assessee carrying on business of manufacture and sale of sugar has to set apart amount, as provided in the Act, for the molasses storage maintenance fund and thus, it has statutory requirement. Further, the amount so deposited in the aforesaid fund can only be utilized for provision and maintenance on adequate storage facilities for molasses subject to permission of Molasses Contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The second question is also covered by a Division Bench judgment of this Court in the case of Commissioner of Income Tax Vs. Dhampur Sugar Mills Ltd. (No.1) reported in ITR (Vol.274) 2005, 370 wherein it has been held as under: "(a) that in respect of the liability for payment of interest chargeable under the Levy Sugar Price Equalization Fund Act, 1976, such liability accrued only after April ..... X X X X Extracts X X X X X X X X Extracts X X X X
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