Section 37, 40, 40A, 194C of Income Tax Act, 1961— This appeal by the assessee arises out of the order passed by CIT(A) .

The first ground is against the confirmation of disallowance on account of excess cane price paid to sugarcane suppliers.
Held that— The issue of payment of excessive price on purchase of sugarcane by the assesses is no more res integra in view of the recent judgment of Hon’ble Supreme Court in CIT Vs. Tasgaon Taluka S.S.K. Ltd. (2019) 103 taxmann.com 57 (SC). we set-aside the impugned order on this score and remit the matter to the file of A.O for deciding it afresh as per law in consonance with the articulation of law by the Hon’ble Supreme Court in the aforenoted judgment.

The second ground is against the confirmation of disallowance of Rs. 36,294/- on account of sugar sold to members at concessional price.

Held that— we have remitted the issue of payment of excessive price to the file of AO, and as such, the instant issue cannot be sent to ld. CIT(A) as it would amount to simultaneously sending one part of the same assessment order to the AO and other to the CIT(A), which is not appropriate. We order accordingly.

The only other issue which survives in the appeal is against the confirmation of disallowance of Rs. 2,64,35,713/- on account of disallowance u/s.40(a)(ia) of the Act.

Held that— As the assessee made payment to group labourers and such annual payments did not exceed Rs. 50,000/- per individual, which at the material time was the threshold for invocation of section 194C, respectfully following the judgment in the case of CIT Vs. Dwarkadheesh Sakhar Karkhana Ltd. (supra), we hold that the disallowance u/s.40(a)(ia) has been wrongly sustained. We, therefore, order to delete the disallowance.[SHIVAJIRAO NILANGEKAR PATIL SAHAKARI SAKHAR KARKHANA LTD. VERSUS DCIT, CIRCLE-3, NANDED] [2019] 17 ITCD Online (14) [ ITAT PUNE]