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2017 (12) TMI 625 - HC - Income TaxEntitlement to the deduction u/s 80-IA - income from generation of power - entitled to deduction on the gross receipt without reducing depreciation under Section 80-IA - Held that:- Expenses incurred and depreciation has to be reduced from the gross receipt, to arrive at the figure on which deduction is to be allowed under Section 80 IA of the Act. Deduction was to be allowed only on the net profits of the said undertaking, which was eligible for deduction under Section 80-IA. It is an accepted and admitted position that the appellant-assessee was entitled to depreciation of over ₹ 3.24 crores on the wind mills, which were installed and used for generating electricity and also commission income. Thus, the depreciation, which was to be allowed and given on the wind mills was almost fifteen times the income earned by the appellant-assessee from generation of electricity, which was eligible for deduction under Section 80-IA. This being the position, we do not think the appellant-assessee would be entitled to deduction on the gross receipt without reducing depreciation under Section 80-IA regardless of whatever interpretation they want to place on the provisions of Section 80IA. In the facts of the present case, the question of bifurcation of depreciation in view of the two lines of business, etc. wanes, as the amount of depreciation, even on bifurcation, which would be reduced from the gross receipts of the undertaking eligible for deduction under section 80IA of the Act, would be significantly higher. We do not, therefore, in the facts of the present case, find any good ground or reason to interfere with the impugned order passed by the Tribunal. The question of law is accordingly, in the facts of the present case, answered against the appellant-assessee and in favour of the Revenue.
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