- (1.) THESE appeals under s. 260A of IT Act have been preferred by the CIT, Meerut and another, against the order dt. 14th to asst. yrs. 1972 -73 to 1979 -80. Appeal No. 267 of 2000 relates to the asst. yr. 1972 -73, Appeal No. 300 of 2000 relates to the asst. yr. 1973 -74, Appeal No. 292 of 2000 relates to the asst. yr. 1975 -76, Appeal No. 293 of 2000 relates to the asst. yr. 1976 -77, Appeal No. 294 of 2000 relates to the asst. yr. 1974 -75 and Appeal No. 297 of 2000 relates to the asst. yr. 1978 -79. All these appeals were heard together and are being disposed of by a common judgment as was jointly agreed by learned counsel for the parties. For the sake of convenience the question of law involved in Appeal No. 266 of 2000 relating to the asst. yr. 1972 -73 is reproduced below. "Whether on the facts and in the circumstances of the case the Tribunal was legally correct to delete the addition of Rs. 4,25,182 holding that the Revenue has failed to prove that these deposits were in the nature of revenue receipt - In other appeals, except the figure of amount and the assessment years, the other things are identical.
(2.) THESE appeals arise out of reassessment proceedings initiated under s. 147 of IT Act. The facts from the appeal relating to the asst. yr. 1972 -73 are being noticed. The original assessment was completed at net loss of Rs. 33,70,144 including unabsorbed losses of earlier years. During the year under consideration the assessee collected a sum of Rs. 4,25,182 representing the deductions made from the cane growers at the rate of 35 paise per quintal towards loss equivilisation and capital redemption fund. By means of re -assessment proceeding, the Revenue has sought to treat the above amount as income of the assessee who is a co -operative society. In response to show cause notice, a written reply was submitted on the ground that the said amount of collection towards loss equivilisation and capital redemption fund is contribution by the farmers towards share capital and the same being a capital receipt is not at all taxable. The said reply was not found favour with the assessing authority and he treated the same as income of the assessee. However, the said order was set aside by the CIT(A) and the order of CIT(A) has been confirmed by the Tribunal vide order under challenge.
(3.) HEARD Sri. A.N. Mahajan, learned standing counsel for the Department and Sri Shakeel Ahmad, learned counsel for the assessee -respondent. Sri. A.N. Mahajan, learned counsel for the Department contends that in view of the earlier judgment of apex Court in the case of CIT vs. Bazpur Co -operative Sugar Factory Ltd. (1988) 70 CTR (SC) 94 : (1988) 172 ITR 321 (SC), the order of the Tribunal holding that the said amount is capital receipt and not income receipt, is not justified.;