Benefit of Sec. 36(1)(vii) available even if sugarcane price fixed by State Govt is more than price fixed by Central Govt
- Blog|News|Income Tax|
- < 1 minute
- By Taxmann
- |
- Last Updated on 27 October, 2021
Latest from Taxmann
Circular 18/2021, dated 25-10-2021
The deduction under section 36(1)(vii) is allowed in respect of expenditure incurred by a cooperative society, which is engaged in the business of manufacture of sugar.
The deduction is allowed for the purchase of sugarcane at a price that is equal to or less than the ‘price fixed or approved by the Government’. The deduction shall be lower of purchase price of the sugarcane or price fixed or approved by the Government.
Recently, the Central Board of Direct Taxes (CBDT) has noticed the issue of treatment of additional payment made by Cooperative society for purchase of sugarcane as an income distribution to farmer members. Thus, the CBDT has issued the clarification after examining the matter.
The CBDT has clarified that the phrase ‘price fixed or approved by the Government’ in section 36(1)(xvii) includes price fixation by State Government through State-level Acts/Orders or other legal instruments that regulate the purchase price for sugarcane. It also includes State Advised Price, which may be higher than the Statutory Minimum price/Fair and remuneration price fixed by Central Government.
Click Here To Read The Full Notification
Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.
Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.
The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:
- The statutory material is obtained only from the authorized and reliable sources
- All the latest developments in the judicial and legislative fields are covered
- Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
- Every content published by Taxmann is complete, accurate and lucid
- All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
- The golden rules of grammar, style and consistency are thoroughly followed
- Font and size that’s easy to read and remain consistent across all imprint and digital publications are applied
Sign Up
To subscribe to our weekly newsletter please log in/register on Taxmann.com
Latest Books
Everything on Tax and Corporate Laws of India
To subscribe to our weekly newsletter please log in/register on Taxmann.com
CA | CS | CMA
