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2023 (1) TMI 473 - ITAT CUTTACKDeduction of notional gain on fair valuation of investments - Claim not made in return of income - HELD THAT:- In view of the principles laid down in the case Goetze (India) Ltd.[2006 (3) TMI 75 - SUPREME COURT] Appellate Tribunal being the appellate authority did have the power to restore the issue to the file of the Assessing officer with the direction to consider the claim of the assessee though the revised return on the issue has not been filed. This being so, respectfully following the ratio laid down supra, the issue as to whether the notional income being the notional fair value gain on the investments in Corporate Debt Bonds is to be considered for taxation in the hands of the assessee or not is restored to the file of the Assessing officer for adjudication on merits. Ground No. 4 of the assessee stands partly allowed for statistical purposes. Non-allowance of deduction u/s. 80-IA - assessee is in the business of generation and distribution of electricity - HELD THAT:- Once the assessee is granted the benefit of deduction u/s. 80IA for one year other than on the issue of variation in the quantification of the deduction u/s. 80IA, the Assessing officer is no more entitled to question the allowability of deduction u/s. 80IA The Hon'ble Jurisdictional High Court of Orissa in the case of the assessee [2019 (7) TMI 1924 - ORISSA HIGH COURT] has categorically held that the assessee is eligible for deduction u/s. 80IA on the legal matrix. It was on the factual issues, the Hon'ble Jurisdictional High Court of Orissa had restored the matter to the ITAT for adjudication. Therefore, categorically on law, the Hon'ble Jurisdictional High Court of Orissa has held the issue in favour of the assessee and on the factual matrix, the Co-ordinate Bench held in favour of the assessee, thus, holding that the assessee is entitled to the benefit of deduction u/s. 80IA of the Act - AO is directed to grant the assessee the benefit of deduction u/s. 80IA as claimed. Ground No. 3 of the assessee stands allowed. TP Adjustment - AO had applied the State Electricity Board rate of Rs. 2.63 per unit as against Rs. 3.83 per unit applied by the assessee - market rate that is to be applied in respect of cost of the unit of electricity generated by the assessee and sold - HELD THAT:- A perusal of provisions of section 80-IA(4) clearly shows that the provision is available to both the undertakings which is doing the business of generating of electricity as also to an undertaking which is in the business of generating and distributing of electricity. A perusal of the facts of the assessee's case clearly shows that 95% of the assessee's power generation has been sold to Tata Steel Limited. Thus, clearly, the assessee is not only generating but also distributing the power. Therefore, the rate applicable as per the provisions of section 80-IA(8) being the market rate would be the rate at which the distribution agencies supplies the electricity and not the rate at which the OERC fixes in respect of supply by generating companies to the distribution companies, which is nothing but the said Electricity company who supplies the electricity to the retailers. The rate at which the electricity could have been sold to distribution companies is not the same at which such companies sell the electricity to the consumers. Thus, clearly, as the assessee herein, is doing both business of generation and distribution of electricity, the decision in the case of ITC Ltd. [2015 (7) TMI 450 - CALCUTTA HIGH COURT] would not be applicable to the facts of the assessee's case. This being so, as the assessee is in the business of distribution of electricity also, it is such rate as retailer would pay for the purpose of purchasing of electricity which is to be considered. In the circumstances, the addition as made by the AO on the issue stands deleted.
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