THE COMMISSIONER OF INCOME TAX-I, AAYAKAR BHAWAN, CIVIL LINES, NAGPUR Vs. THE AKOT GINNING AND PRESSING FACTORY LTD., ANJANGAON ROAD, AKOT

JUDGEMENT

(1.) The department has attempted to raise the following questions as the substantial questions of law in this appeal :

(2.) The facts show that for the assessment year 2003 -2004 the respondent Cooperative Society filed return on 31 -10 -2003 declaring the total income at Rs. Nil after claiming the exemption under Section 80P(2) of the Income Tax Act, 1961 [for short, 'the said Act']. This return was processed under Section 143(1) of the said Act on 27 -02 -2004 and during the scrutiny a notice was issued to the assessee on 20 -10 -2004. The gross total income during that year was of Rs.31,22,952/. We are concerned about the provisions of Section 80P(2)(e) of the said Act and the assessee claimed deduction of Rs.47,95,215/ i.e. at 50% of the ginning and pressing charges. It pointed out that it was as per the order dated 14 -12 -1994 for the assessment year 1990 -1991 in assessee's own case passed by the Commissioner of Income Tax (Appeals)I, Nagpur [CIT (A)].

(3.) A notice under Section 148 of the said Act was issued on 19032008. The assessee on 29 -03 -2008 adopted its return filed on 31102003. The assessee opposed the reopening and also pointed out that there was no error. The Income Tax Officer passed the assessment order on 29 -12 -2008 and after recording the finding that the assessee did not receive any commission income from the Cotton Federation in respect of the ginning and pressing services under any agreement for the assessment year 2003 -2004, the said deduction on 50% of ginning and pressing charges under Section 80P(2)(e) of the said Act was disallowed.