KHARE, J. - (1.) THE Tribunal, Allahabad has referred the following question of law under S. 252 of the IT Act, 1961 for the opinion of this Court. "Whether, the Tribunal was in law justified in upholding the AAC's order deleting the additions made in the asst. yrs. 1972-73 and 1973-74 representing the difference in the price of sugar charged by the assessee over and above the levy price fixed by the government?"
(2.) THE factual background of the case is that the assessee is a private limited company engaged in the business of manufacture and sale of sugar and molasses. The Government of India has fixed a levy price of sugar at Rs. 129.90 per bag. The assessee by means of a petition under article 226 of the Constitution challenged the fixation of the price of sugar. An interim order was passed to the effect that the assessee was made free to charge price at the rate of Rs. 139.58 per bag for the year 1970-71. The difference of the amount came to Rs. 22,699.20 in respect of the year 1972-73 and Rs. 3,01,884 for the asst. yr. 1973-74. The assessee did not disclose this amount in its P&L A/c when the matter was brought before the ITO, the assessee was required to explain the nature of the receipt. The assessee stated before the ITO that the difference charged by it over and above the levy price fixed by the government was in pursuance of the order of the High Court as the assessee was allowed to sell the sugar at a higher rate. Assessee also pointed out before the ITO that the difference of amount was refundable to the purchaser in the event of dismissal of the petition. However, the ITO did not accept the contention of the assessee and included the said difference charged by the assessee in its income. On appeal by the assessee, the AAC held that the disputed amount was not taxable and it ought to have been excluded in the computation of the total income of the assessee. Consequently, the amount included by the ITO was excluded. Aggrieved against the said order of the AAC the Department preferred a second appeal to the Tribunal. The Tribunal dismissed the appeal. We have heard the learned counsel for the Revenue. The question that arises in this case stands concluded by two decisions of this Court. One decision is in the case of Dhampur Sugar Mills Ltd. vs. CIT (1991) 188 ITR 787 (All). In this case, it was held that the amount representing the difference over and above the price of levy sugar fixed under the government of India notification and put into account in the name of the District Magistrate under the orders of the High Court , is not liable to be included in the income of the assessee. The decision was followed in the case of CIT vs. Mahabir Sugar Mills (P) Ltd. (1922) 194 ITR 130 (All).
(3.) IN view of these decisions we are of the view that the difference between the price of levy sugar and that of fixed sugar under the Government of India could not have been included in the income of the assessee. We, therefore, answer the question in the affirmative and against the Department.;