It was held that the matter was to be remanded to the Assessing Officer for decision afresh in consonance with the articulation of the law by the Supreme Court in CIT v. Tasgaon Taluka Sahakari Sakhar Karkhana Ltd (2019) 412 ITR 420 (SC). The Assessing Officer would allow deduction for the price paid under clause 3 of the Sugar Cane (Control) Order, 1966 and then determine the component of distribution of profits embedded in the price paid under clause 5A, by considering the statement of accounts, balance-sheet and other relevant material supplied to the State Government for the purpose of deciding or fixing the final price or additional purchase price or State advised price under this clause. The amount relatable to the profit component or sharing or distribution of profits paid by the assessee, which would be appropriation of income, was not to be allowed as deduction, while the remaining amount, being a charge against the income, was to be considered as deductible expenditure. At this stage, the distribution of profits can only be in respect of the payments made to the members. In respect of payments to non-members the Assessing Officer was to consider the matter afresh applying the provisions of section 40A(2) of the Act, as had been held by the Supreme Court.(AY.  2014-15, 2015-16)