COMMISSIONER OF INCOME TAX, U.P.-II, LUCKNOW vs BAZPUR CO-OPERATIVE SUGAR FACTORY LTD.,BAZPUR, DISTRICTNAIN

The Supreme Court held that the respondent society lacked the authority to amend bye-law 50 with retrospective effect, thus the deductions made from the price payable to members for sugarcane supply must be treated under the unamended bye-law. The Court determined that these deductions constituted revenue receipts and were liable to be included in the taxable income of the assessee. Consequently, the High Court's ruling in favor of the assessee was overturned, and the question was answered in favor of the revenue.