Civil Writ Petition No. 3241 of 1999 -1- **** IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Civil Writ Petition No. 3241 of 1999 Date of decision: 12.10.2010 Punjab State Cooperative Supply & Marketing Federation Ltd. ...Petitioner Versus Union of India and others ...Respondents CORAM: HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MR.JUSTICE AJAY KUMAR MITTAL Present: Mr. Rajesh Garg, Advocate for the assessee Mr. Ygoesh Putney, Advocate for Revenue Ms.Urvashi Dhugga, Advocate **** ADARSH KUMAR GOEL, J ( Oral) 1. This order will dispose of Civil Writ Petition Nos.3241 and 3242 of 1999, ITR Nos.16 to 23 of 1994, ITA No.144 of 2005 and ITA No.407 of 2006 as common questions are involved. 2. As per office report paper-book of ITA No.407 of 2006 is not available. Learned counsel for the appellant has furnished the paper-book of the said case and on that basis, the office may reconstruct the record. 3. In Civil Writ Petition Nos.3241 and 3242 of 1999 challenge is to the amendment of Section 80P(2)(a)(iii) of the Income Civil Writ Petition No. 3241 of 1999 -2- **** Tax Act, 1961 vide Income-Tax (2nd amendment) Act, 1998 which operates from 1.4.1968. By the said amendment word “of” has been substituted by “grown by”. Thus, deduction allowed to the assessee from income from marketing of agricultural produce 'of members' is no longer available unless the produce is 'grown by' them. 4. Learned counsel for the assessee fairly states that during the pendency of this petition, the said provision was considered by Hon'ble Supreme Court and upheld vide judgment in National Agricultural Co-operative Marketing Federation of India Ltd. and another Vs. Union of India and others (2003) 260 ITR 548. 5. Accordingly, both the writ petitions are dismissed. 6. ITA No.144 of 2005 has been preferred by the assessee proposing following substantial questions of law in respect of assessment year 1996-97:- “1. Whether the learned Tribunal was justified in law in upholding the disallowance of deduction claimed under Section 80P(2)(a)(iii) of an amount of Rs.1,32,94,234/- on the ground that law has been amended with retrospective effect, when the issue of validity of retrospective amendment is pending before the Hon'ble Supreme Court in the appellants' own case? 2. Whether the Tribunal is justified in law in upholding that rent received by the appellant from godowns is Civil Writ Petition No. 3241 of 1999 -3- **** income from “business”, thus computing the income under the head “business or profession” and not under the head “income from house property?” 7. Learned counsel for the appellant submits that question no.1 is covered against the assessee by judgment of Hon'ble Supreme Court in National Agricultural Co-operative Marketing Federation. He further states that question no.2 is also covered against the assessee by the judgment of the Court in ITA No.157 of 2005 (Commissioner of Income Tax Vs. M/s Haryana State Cooperative Supply and Marketing) decided on 8.9.2010. Accordingly, both the questions are covered against the assessee. Accordingly, the appeal is dismissed. 8. ITA No.407 of 2006 has been preferred by the assessee proposing following substantial questions of law in respect of assessment year 1994-95:- “1. Whether the learned Tribunal is correct in law in upholding the rectification order impugned in the present appeal when the very basis of the rectification proceedings was debatable before this Hon'ble Court as well as Hon'ble Supreme Court of India? 2. Whether in terms of the judgment of the Hon'ble Supreme Court in 2003 Vol.5 SCC 23 (260 ITR 548) and the orders of Hon'ble Supreme Court in Civil Appeal No.3995 of 2004 in petitioner's own case the Civil Writ Petition No. 3241 of 1999 -4- **** asessment with regard to assessment year 1994-95 could be rectified on the basis of the amendment as it caused unforeseeable financial burden on the appellant in as much as it had planned its business affairs in accordance with the law as it prevailed prior to Supreme Court judgment in Assam Federation Case ( 201 ITR 838)?” 9. Learned counsel for the assessee fairly states that in view of the judgment of Hon'ble Supreme Court in National Agricultural Co-operative Marketing Federation no fault can be found with the rectification order which was passed within limitation. Accordingly, this appeal is dismissed. 10. In ITR Nos. 16 to 23 of 1994, the Income Tax Appellate Tribunal has referred the following question of law for opinion of this Court in respect of the assessment years 1978-79, 1979-80, 1981-82 and and 1982-83:- “Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the Society's income of Rs.7,54,477/-, Rs.44,17,613/-, Rs.45,35,423/-, Rs.1,22,923/-, Rs.99,49,136/-, Rs.41,99,607/-, Rs.2,28,02,000/- and Rs.1,78,82,000/- respectively for assessment years 1972- 73, 1974-75, 1975-76, 1977-78, 1978-79, 1979-80, 1981- 82 and 1982-83 was exempted u/s 80P (2) (a) (iii) of the Income Tax Act, 1961?” Civil Writ Petition No. 3241 of 1999 -5- **** 11. It is not disputed that the assessee claimed deduction of income from marketing produce of the farmers without showing that the said produce was grown by the farmers. In view of the amendment which has been upheld by Hon'ble Supreme Court in National Agricultural Co-operative Marketing Federation the assessee was not entitled to the deduction. Question has, thus, to be answered in favour of the revenue. We order accordingly. The references stand disposed of. (Adarsh Kumar Goel) Judge October 12,2010 (Ajay Kumar Mittal) Pka Judge