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2015 (10) TMI 2737 - AT - Income TaxDisallowance of deduction made u/s 80IA in respect of carbon credit - gain on account of carbon credit is a capital receipt or revenue receipt - Held that:- Case of My Home Power Ltd. [2014 (6) TMI 82 - ANDHRA PRADESH HIGH COURT] affirmed that Carbon Credit is not an offshoot of an environmental concerns. That no asset is generated in the course of business but it is generated due to environmental concerns. The Hon’ble High Court has agreed that the factual analysis as the assessee was carrying the business of power generation. That the carbon credit is not directly linked with the power generation. Hence Hon’ble High Court concluded that on the sale of excess carbon credits the income was received and the same was capital receipt and it cannot be business receipt or income. Thus carbon credit sale emanating to the assessee is a capital receipt not exigible to tax. Accordingly this cross objection filed by the assessee is allowed and we hold that the assessee is not liable to pay any tax on the carbon credit sale receipts. Disallowance of claim u/s 80IA with respect to the receipt on account of carbon credit sale - Held that:- We find that as we have already held that the receipt on account of carbon credit sale is a capital receipt and hence the same is not liable to tax. The adjudication of issue raised by the Revenue is only of academic interest. Accordingly we are not engaging under the same. Hence this ground raised by the Revenue is dismissed as infructuous. - Assessee appeal allowed.
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