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2022 (7) TMI 731 - AT - Income TaxNature of receipts - sale of Renewable Energy Certificate (REC) carbon credits as revenue receipt or a capital receipt - DRP disallowed the claim of the assessee claiming the sale of REC as capital receipt being not offered to tax by holding that the same is a revenue receipt and is liable to be subjected to tax - HELD THAT:- Following the order passed by the co-ordinate Bench of the Tribunal in assessee’s own case for A.Y. 2015-16 which is based upon the decision rendered in case of My Home Power Ltd. [2014 (6) TMI 82 - ANDHRA PRADESH HIGH COURT] we are of the considered view that sale of REC (carbon credits) income received by the assessee is a capital receipt and could not be a business receipt or income nor it is directly linked with the business of the assessee nor any asset is generated in the course of business but it is generated due to environmental concern. Therefore, addition made by Ld. TPO/AO on account of sale of RECs/carbon credits during the year under assessment is not sustainable in the eyes of law, hence, ordered to be deleted. - Decided in favour of assessee.
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