Case: Pravara Sahakari Sakhar Karkhana Limited Vs. Commissioner of Income Tax, Poona

The appellant is a manufacturer of sugar. It is aSociety registered under the BombaySocieties Act. Amongst its members, there is a class of members known aswho have registered some portions of their lands with t he assesses. Those members suppliedgrown in those lands to the appellants factory and they were paid price for the sugarcane supplied at a rate higher than the minimum price prescribed by the Government. Certain other facilities were also made available to them by the assessee. The Income Tax Officer disallowed the payments made by the assessee to thein excess of the minimum price fixed and computed the income of the assessee on that basis. The order of the Income Tax Officer was set aside by the Appellate Assistant Commissioner. He came to the conclusion that the price actually paid by the assessee must be taken into consideration in computing the income of the assessee. The order of the Appellate Assistant Commissioner was confirmed by the Tribunal. The Tribunal rejected the applications made by the Commissioner under Section 66 (1) for a reference to the High Court of certain questions of law said to arise from its order. Thereafter, the Commissioner moved the High Court under S. 66 (1) and the High Court, as mentioned earlier, called upon the Tribunal to submit three questions for its decision.

Court's reasoning:
3. Identical questions of law had came up for consideration in the assessees assessment for the earlier assessment years, namely, assessment years60 andIn respect of those assessments the Tribunal had taken the same view which it has taken in the assessments before us (These appeals relate to the assessment of the assessee for the assessment years). In those cases also the Commissioners applications under Section 66 (1) had been rejected by the Tribunal. Thereafter, the Commissioner had moved the High Court under Section 66 (2). Those applications were rejected by the High Court. Aggrieved by that decision the Commissioner had sought to appeal to this Court under Article 136 of the Constitution. His special leave petitions had been rejected by this Court. The questions of law now sought to be raised are substantially the same as those raised in the previous proceedings. There is absolutely no merit in the contentions advanced by the Commissioner. The High Court was not justified in accepting the Commissioners applications under S. 66 (2).We accordingly allow these appeals and set aside the order of the High Court. The respondent shall pay the costs of the appellant both in this Court as well as in the High Court. Hearing fee one set.