TMI Blog1977 (8) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... n the areas around the assessee's factory at Aska, sugarcane is widely grown but ordinarily cultivation used to be undertaken in the month of February or March. The management of the assessee found that if sugarcane cultivation was undertaken earlier than February the sugar content was higher and, therefore, the sugar yield would be more. On 5th of March, 1967, by a resolution, the assessee's control board decided that a price incentive of Rs. 2 more per ton of cane should be given to encourage early plantation. As this did not generate sufficient incentive, by a later resolution dated 26th of November, 1967, a modified scheme was adopted and it was decided that subsidy for early plantation not being later than February would be advanced at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s filed by the assessee challenging the disallowance of the major portion on the basis that it did not appertain to the year. The Tribunal affirmed the finding of the Appellate Assistant Commissioner that the claim related to revenue expenditure but was not admissible in the year under consideration. At the instance of the assessee, the Cuttack Bench of the Income-tax Appellate Tribunal has stated this case and referred the following question for our opinion: "Whether, on the facts and in the circumstances of the case, the expenditure incurred for payment of the reward under early plantation scheme accrued at the time of payment or any other time ?" The Appellate Assistant Commissioner as also the Appellate Tribunal have upheld the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y name has been entered in the records of the factory .................. If there be any default, I undertake to pay such compensation as may be determined by the managing director of the factory.... (11) If I violate any of the undertakings and fail to supply 40 tons of sugarcane or more from my land, then I would be obliged to return the advance, fertiliser or its costs, any loan for digging wells along with thrice the prize money with interest .................." The resolution of 26th November, 1967 (annexure " 3 ") shows: " 1 . ............ 2. Review of early plantation drive Subsidy for early plantation and enhancement of subsidy for early (end of Feb. '68) of sugarcane plantation. would be Rs. 300 per acre." The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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