SAHAKAR MAHARSHI SHANKAR RAO MOHITE PATIL SAHAKARI SAKHAR KHARKHANA LIMITED Vs. ADDITIONAL COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) IN this group of petitions, the Petitioners have challenged the validity of the notices issued under Section 148 read with Section 147 of the Income Tax Act, 1961 to reopen the assessment orders in respect of various assessment years. Since the issue raised in all these Petitions is common, we have dealt the facts in Writ Petition Np. 5958 of 2001 for the sake of convenience and the decision in this petition will be applicable to all other Writ Petitions.

(2.) THE brief facts relevant for the present petition are as follows:- The petitioner is a Co-operative Society registered under the Maharashtra Co-operative Societies Act, 1960 and carries on business of manufacture and sale of sugar. For the assessment years 1990-91 to 1995-96, the assessee had filed return of income and the assessment proceedings were completed by the assessing officer under Section 143(3) by issue of notice under Section 143(2) and 142(1) of the I.T. Act. The assessment order for A.Y. 1990-91 was passed on 15.12.1992, for A.Y. 1991-92 on 29.9.1993, for A.Y. 1992-93 on 30.11.1994, for A.Y. 1994-95 on 25.3.1994 and for A.Y. 1995-96 on 29.01.1998.

(3.) MR . Inamdar, learned Counsel appearing on behalf of the Petitioners submitted firstly that there was no failure on the part of the assessee to disclose material facts and all facts pertaining to excess cane price and harvesting and transportation charges paid to the cane growers were before the I.T.O. at the time of original assessment and hence the impugned notices issued after expiry of 4 years from the end of the relevant assessment year are bad in law. Secondly, notices issued u/s. 148 of the I.T. Act for A.Y. 1989-90 for the similar reasons in the assessee's own case were challenged by the Petitioners by filing Writ Petition No. 3446 of 2000 and this Court by its Judgment and order dated 13.11.2000 allowed the petition and quashed and set aside all such notices issued by the Respondents and thirdly, even on merits, the issued raised herein is covered by the decision of this Court in the case of C.I.T. Vs. Shree Panchaganga Sahakari Sakhar Karkhana Ltd. Vs. C.I.T. reported in 250 I.T.R. 772, wherein it is held that the reasonableness of the expenditure has to be judged from the point of view of the businessmen and if the expenditure has been incurred within the commercial expediency, then it cannot be disallowed, merely because the payment is in breach of some bye-laws. In this view of the matter, Mr. Inamdar submitted that the issue raised in the petition being squarely covered by the decisions of this Court, the impugned notices are liable to be quashed and set aside.