TMI Blog1967 (12) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... the Indian Income-tax Act, 1922, and the Government Notification No. S.R.O. 3419, dated November 22, 1955, the rebate allowed under that notification can be taken into account in fixing the average price of sugarcane under the said rule ? " The material facts, as appearing from the statement of the case, are these : The assessee is a public limited company carrying on the business of manufacture and sale of sugar which is produced in its factory at Sehore. It has its own farm for growing sugarcane but the produce is not sufficient to meet its requirements. Therefore, it has to purchase sugarcane from other farms in the neighbourhood. The assessment years are 1956-57 and 1937-58, the corresponding account periods being October 27, 1954, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate, with a rebate for purchase at the outlying centres to the extent of a maximum of 3 annas per maund, the Income-tax Officer took the view that the market value had to be computed at the rate fixed by the aforesaid asseessee for purchases made by it from other growers at the various outlying centres. According to the Income-tax Officer, this came to Rs. 1-4-11-15 per maund for the year 1956-57 and Rs. 1-3-12 per maund for the year 1957-58. The Appellate Assistant Commissioner, however, held that the assessee was entitled to get the market value determined on the basis of Rs. 1-7-0 per maund as the market value of sugarcane, the minimum fixed by the Government notification. Being aggrieved, the department took the matter to the Tribunal, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... market in its raw state, or after application to it of any process ordinarily employed by a cultivator or receiver of rent in kind to render it fit to be taken to market, the value calculated according to the average price at which it has been so sold during the year previous to that in which the assessment is made. The notification just mentioned reads : " In exercise of the powers conferred by clause 3 of the Sugarcane (Control) Order, 1955, the Central Government hereby fixes Rs. 1-7-0 per maund as the minimum price to be paid by a producer of sugar by vacuum pan process or his agent for sugarcane delivered at the gate of his factory and Rs. 1-5-0 per maund for sugarcane delivered at railway centre, during 1955-56 crushing season. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... another which is not ordinarily sold in the market in such state. For marketable agricultural produce, the value is required to be calculated according to the average price at which it was sold in the relevant account period. In our opinion, the expression " average price " does not postulate the computation of the average by reducing the minimum price payable at the factory gate by the average rebate deducted by the assessee for purchases made by it from other growers at various outlying centres. So to do would not take into account any price paid in excess of the prescribed minimum. Again, in the instant case, the assessee used its own transport to deliver its sugarcane at the factory gate but it is conceivable that, being unable to do so ..... X X X X Extracts X X X X X X X X Extracts X X X X
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