TMI Blog2015 (8) TMI 600X X X X Extracts X X X X X X X X Extracts X X X X ..... ion reported in Velayudhaswamy Spinning Mills case (2010 (3) TMI 860 - Madras High Court). - Decided in favour of the assessee Sale of carbon credit - CIT(A) treated it as capital in nature - Held that:- This issue has been decided in favour of the assessee by the co-ordinate Bench of this Tribunal in Prabhu Spinning Mills (P) Ltd. and Sivaraj Spinning Mills (P) Ltd. case [2015 (8) TMI 110 - ITAT CHENNAI] following the decision of CIT v. My Home Power Ltd. [2014 (6) TMI 82 - ANDHRA PRADESH HIGH COURT] wherein held “Carbon Credit is not an offshoot of business but an offshoot of environmental concerns - No asset is generated in the course of business but it is generated due to environmental concerns -” Carbon Credit is not even directly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties and the decision relied on. This issue has been considered by the Commissioner of Income-tax (Appeals) and following the decision of the jurisdictional High Court in the case of Velayudhaswamy Spinning Mills P. Ltd. v. Asst. CIT [2012] 340 ITR 477 (Mad) allowed the claim of the assessee observing as under : 9. I have gone through the submissions made by the authorised representative of the appellant. The only issue is regarding allowability of deduction claimed by the appellant under section 80-IA for the year under consideration. The Assessing Officer has denied deduction claimed by the appellant by referring to section 80-IA(5) and held that the profits and gains of an eligible business (windmill business) for the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of the appellant the assessment year 2009-10 is to be considered and not the losses prior to the initial assessment year which have already been set off against some other profits of the concerned assessment years. 11. On verifying the contentions of the authorised representative of the appellant prior to the amendment to section 80-IA by the Finance Act, 1999 the initial assessment year was defined in the Act. But after the amendment there is no definition for initial assessment year in the Act and there is option to the assessee in selection of the year of claiming relief under section 80-IA. In view of this, there is no question of setting off notionally carried forward unabsorbed business loss against the profi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Income-tax (Appeals) we do not find any good reason to interfere with the findings and thus we uphold the order of the Commissioner of Income-tax (Appeals) on this issue. 7. The next issue in the appeal of the Revenue is that the Commissioner of Income-tax (Appeals) erred in considering sale of carbon credit as capital in nature. 8. Counsel for the assessee submits that this issue has been decided in favour of the assessee by the co-ordinate Bench of this Tribunal in the case of Prabhu Spinning Mills P. Ltd. and Sivaraj Spinning Mills Ltd. in I. T. A. No. 651 and 652/Mds/2013 dated July 31, 2014 [2015] 4 ITR (Trib)-OL 209 (Chennai). Counsel further submits that an identical issue has been decided by the hon'ble Andhra Pradesh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sought to be preferred and admitted against the judgment and order of the learned Tribunal, dated November 2, 2012 (My Home Power Ltd. v. Deputy CIT [2013] 21 ITR (Trib) 186 (Hyd)), on the following substantial questions of law : 1. Whether, in the facts and in the circumstances of the case and in law, the Income-tax Appellate Tribunal is correct in holding that the sale of carbon credits is to be considered as capital receipt and not liable for tax under any head of income under the Income-tax Act, 1961 ? 2. Whether, in the facts and in the circumstances of the case and in law, the Income-tax Appellate Tribunal is correct in holding that there is no cost of acquisition or cost of production to get entitle ..... X X X X Extracts X X X X X X X X Extracts X X X X
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