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| The Tax Publishers2019 TaxPub(DT) 6806 (Pune-Trib) INCOME TAX ACT, 1961
Section 80P(2)(b)
Assessee is eligible for deduction under section 80P(2)(b) on the milk sold to outside parties but said benefit would be restricted to the price at which it was actually sold in the open market or price at which milk was sold to Federal Society, whichever is less. Moreover, if in any month milk was not sold by assessee to the Federal Society, then benefit of deduction under section 80P(2)(b) should not be extended on sale of milk for said month.
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Deduction under section 80P(2)(b) - Co-operative society - Supply of milk to federal as well as non-federal societies -
Assessee-Co-operative Society was engaged in the business of collecting milk from its members and supplying the same to federal society as well as to private parties. AO disallowed the deduction claimed by assessee under section 80P(2)(b) on the profits earned from sale of milk to other than federal society. Held: Assessee is eligible for deduction under section 80P (2)(b) on the milk sold to outside parties. However, the benefit of deduction under section 80P(2)(b) on sale of milk would be restricted to the price at which it was actually sold in the open market or price at which milk was sold to Federal Society, whichever is less. Moreover, as in the month of August, 2009 no milk was sold by the assessee to the Federal Society, benefit of deduction under section 80P (2)(b) should not be extended on sale of milk for said month. Hence, AO was directed to re-compute the deduction under section 80P (2)(b) by excluding the sale made to outsiders in the month of August, 2009.
Relied:Bajaj Tempo Ltd. v. CIT (1992) 196 ITR 188 (SC) : 1992 TaxPub(DT) 1271 (SC)
REFERRED :
FAVOUR : Partly in assessee's favour
A.Y. : 2009-10
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