TMI Blog2023 (1) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... AO. Hence, the ground of appeal of the revenue is hereby dismissed. Deduction u/s 80IA by treating them as profit derived from the business of distribution of power - AO disputed the deduction with respect to such items of income - Delayed payment charges from customers - HELD THAT:- No material has been placed on record by the Revenue to demonstrate that the decision of Tribunal as discussed above has been set aside / stayed or overruled by the Higher Judicial Authorities. Before us, Revenue has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of earlier year nor has placed any contrary binding decision in its support. Thus, respectfully following the order this tribunal in the own case of assessee, we uphold the finding of the learned CIT(A). Thus, we hold that the assessee is eligible for deduction under section 80-IA of the Act with respect to delayed payment charges from customers. Interest from customer - No material has been placed on record by the Revenue to demonstrate that the decision of Tribunal as discussed above has been set aside / stayed or overruled by the Hig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the view that the income shown by the assessee by way of scrap sale is not directly arising from the activity of power generation but incidental to the business of the assessee. Accordingly, the same cannot be made subject to deduction under section 80 IA - in effect only the amount of material consumed is claimed as deduction against the income of the assessee. If obsolete stores have been sold out in the year under consideration the same will be shown as income in the profit and loss account at the sale price and simultaneously the corresponding material cost of the consumables will be debited in the profit and loss account. Thus in effect the losses that the assessee has incurred on account of obsolescence of consumable materials is reduced by the amount of sale s realization. It is a matter manner of presentation in the books of accounts about the sale of consumable materials. If the assessee instead of showing the sale of the consumable materials as income and adjusting the same against the cost of the consumables sold by it there will not be any income in the books of accounts of the assessee and accordingly the question of disallowances of deduction under the section 80 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as ground of appeal of the Revenue is dismissed. Disallowances of interest fmade on account of diversion of interest bearing fund - HELD THAT:- Admittedly, the own fund of the assessee exceeds the amount of loans provided without charging interest thereon. The own fund of the assessee stands at Rs. 3960.15 crore only whereas the amount of loans and advances to subsidiary stands at Rs. 49.79 crore only which can be verified form the financial statement available on record. Thus, a presumption can be drawn that such amount of loan advances have been provided by the assessee out of its own fund. Therefore, there cannot be any disallowance of interest expenses. Hence the ground of appeal of the Revenue is hereby dismissed. Addition made to the books profit u/s 115JB being disallowances under section 14A read with rule 8D of the Income Tax Rules - HELD THAT:- DR has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of earlier year nor has placed any contrary binding decision in its support. Thus, respectfully following the order this tribunal in the own case of assessee, we set-aside the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... % being gross income from the streetlight maintenance activity. Hence the ground of appeal of the assessee is partly allowed. Disallowance of deduction claimed under section 80-IA on account of recovery of bad debts in Ahmedabad unit and Surat unit - HELD THAT:- Where Assessing Officer finds that claim has already been allowed in the earlier year then such benefit under section 80-IA should be given to the profits taxed under section 41(1). The argument of ld. AR is that once it has declared profits under section 41(1) it would mean that assessee has already claimed and allowed deduction thereof in earlier years but in our considered view it requires verification and for that matter we restore the matter to the file of Assessing Officer. Accordingly this ground of assessee is allowed for statistical purposes. Disallowances of deduction under section 80-IA on account of FD interest income and interest on IT refund - HELD THAT:- Identical issue with respect to the eligibility of deduction of income from the activity of interest on FD and income tax refund came up before this Tribunal in the own case of the assessee for AY 2008-09 [ 2022 (1) TMI 174 - ITAT AHMEDABAD ] where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and power distribution. In the absence of any nexus, we do not find any reason to interfere in the finding of the learned CIT-A. Accordingly, we confirm the same. Hence, the ground of appeal of the assessee is partly allowed. Disallowance of deduction under section 80-IA representing receipt of store billing charges - HELD THAT:- Eligibility of deduction of income from the activity of store billing charges came up before this tribunal in the own case of the assessee for AY 2011-12 [ 2022 (1) TMI 174 - ITAT AHMEDABAD ] where the issue has been decided against the assessee. AR or DR has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of earlier year nor has placed any contrary binding decision in its support. Thus, respectfully following the order this tribunal in the own case of assessee, we hereby set aside the finding of the learned CIT(A). Thus, the ground of objection raised by the Assessee is hereby dismissed. Denying the benefit of deduction under section 80 IA with respect to certain incomes - HELD THAT:- It is the trite law that the income, which has direct nexus with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been any question of showing the impugned income and consequently for disallowing the deduction claimed by the assessee under the provisions of section 80 IA of the Act. Accordingly, we hold that the assessee is eligible for deduction on such discount. Unscheduled interchange income - We note that in the process of supply of electricity through GETCO, sometimes there were excess or short transmission of electricity to customer than the billed unit. On such excess transmission of electricity, the assessee charged consideration. Thus, it appears that such receipt has direct link from the activity generation and distribution of power as it is charged on the excess supply of power. In our considered view, such receipt is part parcel to the sales made by the assessee. Accordingly, we hold that the assessee is eligible for deduction on such discount. Meter fixing fee - We note that the assessee was in receipt of an amount of Rs. 41,51,680/- from the meter fixing services, testing fee, fault attending fee etc. The AO held that the such receipts are not derived from the activity of the generation or distribution of power. At the outset, we note that electricity to the end custome ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to Rs.3,21,68,86,818/-. 2. that the Ld. ClT(Appeals) erred in law and on facts in not appreciating the facts that the assessee had not shown the outstanding number of Certified Emission Reductions in its balance sheet as on 31.03.2012 neither it had shown the name as capital asset but had shown the same as business receipts. 3. that the Id. CIT(Appeals) erred in law and on fads in not appreciating the fact.1; that the Certified Emission Reductions/ Carbon Credit is an entitlement or privilege accrued to the assessee in the course of carrying on power generation activity, it cannot be said that such Carbon Credit is an accretion of capital asset. 4. that the Id. CIT(Appeals) erred in law and on facts in deleting the addition made on account of disallowance of delayed payment charges from customers u/s. 80-IA of the Income Tax Act, 1961 amounting to Rs.2,73,55,535/-, 5. that the Id. CIT(Appeals) erred in law and on facts in deleting the addition made on account of disallowance of interest from customers on late receipt u/s. 80-IA of the Income Tax Act, 1961 amounting to Rs. 7,65,09,33'57- 6. that the Id. CIT(Appeals) erred in law and on fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled to discharge the onus to prove that interest free fund were available with the assessee while advancing interest free loan. 16. that the Id CIT (Appeals) erred in law and on facts in deleting the addition made to book profit u/s. 14A r, w. rule 8D of the Income Tax Act, 1961 totaling to Rs.6,78,94,834/- 17. that the Id. CIT (Appeals) erred in law and on facts in deleting the addition made on account of not granting of credit for dividend distribution tax(DDT) amounting to Rs.42,15,37,467/- 18. that the Id. CIT (Appeals) erred in law and on facts in not appreciating the fact that no credit is allowable in respect of dividend distribution tax against income tax payable by the assessee. 4. The interconnected issue raised by the Revenue vide ground Nos. 1 to 3 of its appeal is that the learned CIT-(A) erred in deleting the disallowances of deduction under section 80-IA of the Act for Rs. 321,68,86,818/- on account of income on sale of certified emission Reduction by treating the same as capital asset. 5. The facts in brief are that the assessee is a public company and engaged in the business of generation and distribution of electricity. The AO during t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has taken alternate ground that sale of CERs is capital receipt which is denied by AO on the ground that it is business receipt under Section 28(4) of the Act and Appellant itself has shown such income as revenue receipt in profit loss account. This issue has been discussed by Hon'ble Hyderabad ITAT in the case of My Home Power Limited 151 TTJ 616 as under; 24. We have heard both the parties and perused the material on record. Carton credit is in the nature of an entitlement received to improve world atmosphere and environment reducing carbon, heat and gas emissions. The entitlement earned for carbon credits can, at best, be regarded as a capital receipt and cannot be taxed as a revenue receipt. It is not generated or created due to carrying on business but it is accrued due to world concern . It has been made available assuming character of transferable right or entitlement only due to world concern. The source of carbon credit is world concern and environment. Due to that the assessee gets a privilege in the nature of transfer of carbon credits. Thus, the amount received for carbon credits has no element of profit or gain and it cannot be subjected to tax in any man ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in the course of business but it is generated due to environmental concerns. Credit for reducing carbon emission or greenhouse effect can be transferred to another party in need of reduction of carbon emission. It does not increase profit in any, manner and does not need any expenses. It is a nature of entitlement to reduce carbon emission, however, there is no cost of acquisition or cost of production to get this entitlement. Carbon credit is not in the nature of profit or in the nature of income. 25. Further, as per guidance note on accounting for Self-generated Certified Emission Reductions (CERs) issued by the Institute of Chartered Accountants of India (ICAI) in June, 2009 states that CERs should be recognised in books when those are created by UNFCCC and/or unconditionally available to the generating entity. CERs are inventories of the generating entities as they are generated and held for the purpose of sale in ordinary course. Even though CERs are intangible assets those should be accounted as per AS-2 (Valuation of inventories) at a cost or market price, whichever is lower. Since CERs are recognized as inventories, the generating assesses should apply AS-9 to re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the issue at length and squarely held that the carbon credits are generated out of environmental concerns which does not have any character of trading activity; therefore, any receipt from an activity which is not a trading activity is capital in nature by following observation:- 19.1 The Hon'ble High Court further relied on the judgment of Hon'ble Andhra Pradesh High Court in the case of CIT vs. My Home Power Ltd [2014] 46 taxmsnn.com 314/365ITR 82 and the judgment of Hon'ble Karnataka High Court in the case of CIT vs. D.G. Gopala Gowda, [2013] 354 ITR 501, which have taken the same view on realization of carbon credits as capital receipt There is no contrary judgment and the two Hon'ble High Courts, i.e. Andhra Pradesh High Court and Karnataka High Court, having taken a concurrent view on this matter, are to be followed in judicial discipline. 19.2 The Id. Departmental Representative, on the other hand, contends that the realization from carbon credits has been treated by the appellant itself as revenue income and offered to tax and in fact in actualities they are revenue receipt, However, no adverse judgment on this has been cited. 20. We have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sent appeal. This ground of appeal is thus allowed. 8. Being aggrieved by the order of the learned CIT-A, the assessee is in appeal before us. 9. Both the learned DR and the AR before us vehemently supported the order of the authorities below. 10. We have heard the rival contentions of both the parties and perused the materials available on record. At the outset, we note that there are several orders/ judgments wherein it has been held that the carbon credit received by the assessee represents the capital receipt which is not chargeable to tax. Some of the judgments are illustrated below: 10.1 The Hon ble Andhra Pradesh High Court in case of CIT vs. My Home Power Ltd reported in 46 taxmann.com 314 in identical fact and circumstances has held as under: 3. We have considered the aforesaid submission and we are unable to accept the same, as the learned Tribunal has factually found that 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. We agree with this factual analysis as the assessee is carrying on the business of power generatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... damages/rebate Rs. 2,12,47,267/- 5. Sale of scrap Rs. 10,45,41,099 12.1 Nevertheless, the assessee has claimed deduction under section 80IA of the Act by treating them as profit derived from the business of distribution of power. However, the AO disputed the deduction with respect to such items of income. However, in appellate proceeding the learned CIT(A) held the above items of income as eligible for deduction under section 80IA of the Act. Thus the Revenue is in appeal before us. For the sake of convenience, we proceed to adjudicate each item of income shown by the assessee and claimed deduction under section 80IA of the Act in the manner as detailed below: Delayed payment charges from customers 13. At the outset, we note that identical issue came before this tribunal in the own case of the assessee for AY 2008-09 in ITA No. 776 738/Ahd/2012 where the issue has been decided in favour of the assessee and against the Revenue vide order dated 09-12-2021. The relevant finding of the Bench is extracted as under: 80. We have heard the rival contentions of both the parties and peruse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al undertaking as the same cannot be stated to have been derived from the business of the industrial undertaking. 31. In the result, both the questions stand answered as hereinbefore. The appeal is accordingly allowed and stands disposed of. 80.1 From the preceding discussion we note that the judgment was rendered in connection with the interest income which is eligible for deduction under section 80-I of the Act but the principles laid down therein can also be adopted to the provisions of section 80-IA of the Act in the given facts and circumstances. In view of the above we do not find any infirmity in the order of learned CIT (A). Hence the issue raised by the revenue is dismissed. 13.1 Before us, no material has been placed on record by the Revenue to demonstrate that the decision of Tribunal as discussed above has been set aside / stayed or overruled by the Higher Judicial Authorities. Before us, Revenue has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of earlier year nor has placed any contrary binding decision in its support. Thus, respectfully following the order thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng, but in case of illustration (b) above, if the payment is described as sale price it would be profits derived from the industrial undertaking. This can never be, because in sum and substance these are only two modes of realising sale consideration, the object being to realise sale proceeds at the earliest and without delay. Purchaser pays higher sale price if it delays payment of sale proceeds. In other words, this is a converse situation to offering of cash discount. Thus, in principle, in reality, the transaction remains the same and there is no distinction as to the source. It is incorrect to state that the source for interest is the out-standing sale proceeds. It is not the assessee s business to lend funds and earn interest. The distinction drawn by Revenue is artificial in nature and is neither in consonance with law nor commercial practice. 30. The Tribunal was, therefore, not justified in holding that while computing deduction under section 80-I of the Act, interest received from trade debtors towards late payment of sales consideration is required to be excluded from the profits of the industrial undertaking as the same cannot be stated to have been derived from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts of the case for the year under consideration and that of earlier year nor has placed any contrary binding decision in its support. Thus, respectfully following the order this tribunal in the own case of assessee, we uphold the finding of the learned CIT(A). Thus, we hold that the assessee is eligible for deduction under section 80-IA of the Act with respect to Shifting Services. Liquidation damage/ Rebate 16. The assessee during the year has shown receipt of Rs. 2,12,47,267/- being liquidation damages/rebate in Ahmedabad Distribution unit, Surat Distribution unit and Surat generation unit. The assessee submitted that the liquidation damages were received from suppliers in case of short or late supply of materials or deficiency in materials supplied/ services rendered etc. Likewise, the assessee has received rebate under CERC regulation for prompt payment of transmission charges to PGCIL. Accordingly, the assessee contended that the above amount was received in the ordinary course of business and having direct nexus with the activity of distribution of power. Hence, the same is eligible for deduction under section 80-IA of the Act. 16.1 However, the AO disagree ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was justified In its view - Held, yes [Paras 6 and 14] [In favour of appellant] Similar view is taken by Hon'ble MP High Court in case of CIT v Prakash Oils Ltd dated 08.03.2011 [58 DTR 279] in case of liquidated damages income. Hon'ble Gujarat High Court in the case of CIT vs Metrochem Industries Ltd. [[2017] 79 taxmann.com 440 has also allowed deduction u/s 80IA on Kasar and discount which is similar in nature of rebate as discussed herein above. Relying upon decisions referred supra, the AO is directed to allow deduction u/s SOIA on liquidated damages/rebate. 18. Being aggrieved by the order of the learned CIT(A), the Revenue is in appeal before us. 19. The learned DR before us contended that income to the assessee under the head liquidation damages and rebate does not arise from the activity of power generation and distribution and therefore the same is not eligible for deduction under section 80 IA of the Act. 20. On the contrary, the learned AR contended that the income to the assessee as discussed above directly relates to the activity of power generation and distribution. Therefore, the same is eligible for deduction under section 80 IA of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. Accordingly, the same cannot be made subject to deduction under section 80 IA of the Act. 23. On appeal, the learned CIT-A was pleased to allow the deduction to the assessee under the provisions of section 80 IA of the Act with respect to the sales of scrap by observing as under: 5.8.3 The submission is considered. So far as deduction under Section 80-IA on sale of scrap is concerned, it is observed that same has been shown by Appellant as business income and the same is accepted by AO as such. The AO has not brought any evidences to suggest that same relates to capital assets. The income has been credited in distribution units and AO has not proved that such sale of scrap does not relate to business of power distribution undertaken by various units. . Hon'ble Gujarat High Court in the case of CIT V/s Jikar A. Saiyed 42 taxman.com 403 has held as under: 'Section 80-/B of the Income-tax Act, 1961 - Deductions - Profits and gains from industrial undertakings other than infrastructure development undertakings [Computation of deduction] - Assessment year 2001-02 -Whether in view of orders passed in cases of Dy, CIT v. Harjivanda$JuthabhaiZaveri[2002j 258 ITR 785 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earned CIT-A. 26.1 When the consumable stores are purchased by the assessee, they are directly debited in the profit and loss account and the balance if remaining at the end of the year is shown as closing stock in the profit and loss account after making the adjustment of the consumption which is debited in the profit and loss account. Thus in effect only the amount of material consumed is claimed as deduction against the income of the assessee. If obsolete stores have been sold out in the year under consideration the same will be shown as income in the profit and loss account at the sale price and simultaneously the corresponding material cost of the consumables will be debited in the profit and loss account. Thus in effect the losses that the assessee has incurred on account of obsolescence of consumable materials is reduced by the amount of sale s realization. It is a matter manner of presentation in the books of accounts about the sale of consumable materials. If the assessee instead of showing the sale of the consumable materials as income and adjusting the same against the cost of the consumables sold by it there will not be any income in the books of accounts of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct from the gross total income of the assessee. It is for the reason that the entire amount of profit with respect to such eligible undertaking has already been allowed as deduction under the provisions of section 80-IA of the Act. Accordingly, the AO issued a show cause notice to the assessee proposing to disallow the deduction claimed under section 80G/GGB of the Act. 28.3 The assessee in response thereto submitted that the deduction under section 80G/80GGB of the Act is eligible/allowed from the Gross Total Income when the payment is made to certain organizations specified therein. On the contrary the deduction under section 80-IA of the Act is provided for the specified business activity carried on by the assessee. Thus, the deductions under section 80G/80GGB of the Act and 80-IA of the Act are mutually exclusive and independent to each other. The assessee while claiming the deduction under section 80-IA of the Act against the profit of the specified business can also claimed the deduction under section 80G/80GGB of the Act separately. 28.4 However, the AO disregarded the contention of the assessee by observing that there remained no taxable profit after claiming the dedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmining the eligible profit. Thus, the amount eligible for deduction under section 80-IA of the Act is computed from the business referred therein only. 114.1 Now coming to the case on hand the donations paid by the assessee against the eligible undertaking which is qualified for deduction under section 80G/80GGGB of the Act, the same cannot be considered as an expense/payment against the specific business/undertaking eligible for deduction under section 80-IA of the Act. It is for the reason that the donation under section 80G/80GGB of the Act does not relate to the activity of eligible undertaking. In other words, the payment under section 80G/80GGB of the Act is eligible for deduction on account of the payment made to the specific institution irrespective of the business whether it is eligible or non-eligible carried on by the assessee. 114.2 There is no dispute to the fact that the amount of donation was claimed by the assessee in the profit and loss account of the eligible undertaking which has been disallowed while computing the eligible profit. Certainly, the profit of the eligible undertaking will increase by the amount of disallowance made by the assessee on acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e preferred an appeal before the learned CIT(A) and submitted that no exempt was income earned during the year, hence no disallowance under section 14A r.w.r. 8D of Income Tax Rules is required to be made. 36. The learned CIT(A) after considering the facts in totality deleted the addition made by the AO by observing as under: 7.2 The submission is considered. The AO has made disallowance under Section 14A applying Rule 8D, the Appellant has not earned any exempt income during the year which is not disputed by AO. The Hon'ble Gujarat High Court in the case of Corrtech Energy Pvt. Limited 45 taxman.com 116 on identical disallowance under Section 14A when no exempt income is earned, the Court has held as under: 4. Counsel for the Revenue submitted that the Assessing Officer as well as ClT(Appeals) had applied formula of rule B'J of the Income Tax Rules, since this case arose after the assessment year 20C,;-2Q10. Since in the present case, we are concerned with the assessment year 2009-2010, such formula was correctly applied by the Revenue. We however, notice that sub-section(l) of section 14A provides that for the purpose of computing total income under chapter IV ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iven effect to and not the view expressed in a decision of this Court or the High Court. So far as the clarification/circulars issued by the Central Government and of the State Government are concerned they represent merely their understanding of the statutory provisions. They are not binding upon the Court. It is for the Court to declare what the particular provision of statute says and it is not for the Executive looked al from another angle, a circular which is contrary to the statutory has realty no existence in taw, The conclusion of the matter is that the law declared by Supreme Court is binding in terms of Article 141 of the Constitution. The Assessing Officer cannot simply brush aside the interpretation by Courts, in view of the aforesaid discussion, the disallowance made by the Assessing Officer invoking the provisions of Section 14A of the Act is not correct and hence, same is deleted. Accordingly, ground No. 6, 7 and 8 of the appeal are allowed. 37. Being aggrieved by the order of the learned CIT(A), the Revenue is in appeal before us. 38. Both the learned DR and the AR before us vehemently supported the order of the authorities below as favourable to them. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deny the benefit to the assessee for which it was entitled. 210.3 It is also pertinent to note that the assessee has filed the return of income for the year under consideration dated 29-9-2011 wherein the disallowance of Rs. 1,57,95,815/- was made under the provisions of section 14A read with rule 8D. At that point of time, there was no clarity on the issue whether there will not be any disallowance under the provisions of section 14A read with rule 8D of Income Tax Rule if there was no exempted income. However this clarity was brought on a later date by the Hon ble Gujarat High Court in the case of Corrtech Energy Ltd (Supra) vide order dated 24-3-2014. The contents of the order has already been reproduced in the preceding paragraph. Thus, there remains no ambiguity that the assessee was not aware of the provisions of law at the time of filing the return of income. 210.4 Be that as may be, the assessee cannot be deprived from the benefits provided under the provisions of law more particularly in a situation where the proceedings of the assessee for the year under consideration were pending before the higher authorities on same issues. 210.5 In view of the above an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve heard the rival contentions of both the parties and perused the materials available on record. Admittedly, the own fund of the assessee exceeds the amount of loans provided without charging interest thereon. The own fund of the assessee stands at Rs. 3960.15 crore only whereas the amount of loans and advances to subsidiary stands at Rs. 49.79 crore only which can be verified form the financial statement available on record. Thus, a presumption can be drawn that such amount of loan advances have been provided by the assessee out of its own fund. Therefore, there cannot be any disallowance of interest expenses. Hence the ground of appeal of the Revenue is hereby dismissed. 45.1 Before us, no material has been placed on record by the Revenue to demonstrate that the decision of Tribunal as discussed above has been set aside / stayed or overruled by the Higher Judicial Authorities. Before us, Revenue has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of earlier year nor has placed any contrary binding decision in its support. Thus, respectfully following the order this tribunal in the ow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f) of explanation 1 to section 115JB of the Act. 124.1 However, we note that in the recent judgment of Special Bench of Hon ble Delhi Tribunal in the case of ACIT vs. Vireet Investment Pvt. Ltd. reported in 82 Taxmann.com 415 has held that the disallowances made u/s 14A r.w.r. 8D cannot be the subject matter of addition while determining the net profit u/s 115JB of the Act. The relevant portion of the said order is reproduced below: In view of above discussion, the computation under clause (f) of Explanation 1 to section 115JB(2), is to be made without resorting to the computation as contemplated under section 14A, read with rule 8D of the Income-tax Rules, 1962. 124.2 The ratio laid down by the Hon ble Tribunal is squarely applicable to the facts of the case on hand. Thus it can be concluded that the disallowance made under section 14A r.w.r. 8D cannot be resorted while determining the expenses as mentioned under clause (f) to explanation 1 to section 115JB of the Act. 124.3 However, it is pertinent to note that the disallowance needs to be made with respect to the exempted income in terms of the provisions of clause (f) to section 115JB of the Act while determini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndently. Therefore our action for restoring back the issue to the file of AO would unnecessarily cause further litigation. Thus we limit the disallowance on an ad-hoc basis @ 1 % of the exempted income as per the clause (f) to Explanation-1 of Sec. 115JB of the Act. Thus the ground of appeal of the Revenue is partly allowed. 51.1 Before us, no material has been placed on record by the learned AR or DR to demonstrate that the decision of Tribunal as discussed above has been set aside / stayed or overruled by the Higher Judicial Authorities. Before us, learned AR or DR has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of earlier year nor has placed any contrary binding decision in its support. Thus, respectfully following the order this tribunal in the own case of assessee, we set-aside the finding of the learned CIT(A) and direct the AO make adhoc disallowances @ 1% of exempted income. However, in the given facts and circumstances, we find that there was no exempt income in the year under consideration, therefore there cannot be any disallowance while computing the book profit under se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A) erred in confirming the finding of the learned Assessing Officer that the expenditure of Rs.5,92,12,205 claimed by the Respondent-company as incurred in relation to the Street Light Maintenance Income, is not supported by evidence and thereby restricting the deduction in respect of such expenditure to the extent of Rs. 4,12,12,6657- only.55.1 3. On the facts and in the circumstances of the case, the learned CIT(A) erred in confirming the learned Assessing Officer's finding that bad debt recovery of Rs.93,15,306 in respect of Ahmedabad unit and Rs.38,97,867 in respect of the Surat unit are not eligible for deduction u/s.80-IA of the IT. Act. 4. On the facts and in the circumstances of the case, the learned CIT(A) erred in upholding the finding of the learned Assessing Officer that interest deposits amounting to Rs.1,37,41,456/- and Rs.61,45,411 being other interest income are not eligible for deduction u/s.80-IA of the IT. Act. 5. On the facts and in the circumstances of the case, the learned CIT(A) erred in upholding the finding of the learned Assessing Officer that rental income of Rs.5,36,138 in respect of Ahmedabad unit and Rs.83,293 in respect of Surat uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in law and in the facts and circumstances of the appellant's case, the appellant requests for admission of its additional claim and for allowing deduction of Rs. 9,84,48,624/- in respect of Education Cess and the Secondary and Higher Education Cess on income tax, on the ground that such expenditure is allowable business expenditure u/s 37(1) of the Act as per settled legal precedents. 2. Without prejudice to all the grounds raised, in law and in the facts and circumstances of the appellant's case, the appellant requests for admission of its additional claim and for allowing deduction of Rs.1,89,74,745/- in respect of Education Cess and the Secondary and Higher Education Cess on Dividend Distribution Tax, on the ground that such expenditure is allowable business expenditure u/s.37(1) of the Act as per settled legal precedent. 3. Without prejudice to all the grounds raised, in law and in the facts and circumstances of the appellant's case, the appellant requests for admission of its additional claim and for not including the proceeds of Rs. 3,21,68,86,818/- received on sale of carbon credits, while computing the Book Profit u/s. 115JB of the Act on the ground t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enance services cannot be made eligible for deduction under section 80IA of the Act. 57.3 The AO further held that the claim of the assessee that it incurred a cost of Rs. 11,40,67,489/- cannot be accepted for the reason that the same is not supported by the evidences. There was also no explanation furnished by the assessee that how it worked the amount of Rs. 71,31,629/- being the expenditure over income. Nevertheless, the AO held that expenses incurred by the assessee in relation to maintenance services cannot be denied. Therefore, the AO estimated the profit from the activity of streetlight maintenance services at Rs. 1,08,66,911/- being 0.00065% of total revenue and excluded the same from the computation of income under section 80-IA of the Act. 58. Aggrieved assessee preferred an appeal to the learned CIT (A), who confirmed the finding of the AO by following the order of his predecessor CIT(A) in own case of the assessee for AY 2010-11. 59. Being aggrieved by the order of the learned CIT (A), the assessee is in appeal before us by this cross objection. 60. The learned AR before us contended that the provisions of section 80-IA of the Act are beneficial provisions a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urce is discovered. 38.2 At this juncture it is important to refer judgment of SC in the case of Cambay Electric Supply Industrial Co. Ltd. v. CIT [1978] 113 ITR 84 (SC) which have interpreted the term derived from . The relevant decisions of the Supreme Court: The Legislature has deliberately used the expression attributable to , having a wider import than the expression derived from , thereby intending to cover receipts from sources other than the actual conduct of the business of the specified industry. (p.85) 38.3 From the ratio of the aforesaid decision of the Apex Court, it is clear that the phrase derived from covers receipts from the actual conduct of business of the specified industry as provided under section 80-IA of the Act. 38.4 Likewise, as per the Bombay High Court in the case of Hindustan Lever Ltd. v. CIT [1980] 121 ITR 951/3 Taxman 390, the word derived as far as income tax law is concerned, has been given a narrow meaning - a strict meaning, by the courts and has been understood in the restricted sense of a direct derivation and not understood in the broad sense as equivalent to be derived directly or indirectly. In other words, only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e also note that the basis adopted by the AO for computing the income relating to streetlight maintenance does not seem to the proper. It is because, the AO has considered all the income of the assessee for working out the profit from the activity of streetlight maintenance instead of making the estimate directly on the income shown by the assessee under the head streetlight maintenance. In simple words, the AO could have estimated the profit on some reasonable basis in relation to the gross income shown by the assessee from the activity of streetlight maintenance. As such, we are of the view that the justice shall be served to the assessee and the revenue, if the income of the assessee from the streetlight maintenance is estimated at the rate of 8% of Rs. 5,48,55,284/- being gross income from the streetlight maintenance activity. Hence the ground of appeal of the assessee is partly allowed. 63. The next objection raised by the assessee vide ground no. 3 is that the learned CIT(A) erred in sustaining the disallowance of deduction claimed under section 80-IA of the Act for Rs. 93,15,306/- and Rs. 38,97,867/- on account of recovery of bad debts in Ahmedabad unit and Surat unit. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 80-IA of the Act. Therefore, any recovery of such bad debts cannot be allowed as deduction under section 80 IA of the Act. The finding of the AO has not been controverted by the assessee. The learned CIT(A) also found that identical disallowance was also made in earlier year being AY 2008-09 to 2010-11 which has been confirmed by the ld. predecessor CIT(A). Thus, the learned CIT(A) confirmed the disallowance made by the AO. 66. Being aggrieved by the order of learned CIT (A) the assessee is in appeal before us. 67. The learned AR before us contended that the bad debts were recovered with respect to the eligible undertaking. Therefore, the same should be eligible for deduction under section 80 IA of the Act. 68. On the other hand, the ld. DR vehemently supported the order of the authorities below. 69. We have heard the rival contentions of both the parties and perused the materials available on record. At the outset, we note that identical issue with respect to the eligibility of deduction of income from the activity of streetlight maintenance services came before this Tribunal in the own case of the assessee for AY 2008-09 in ITA No. 776 738/Ahd/2012 where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be seen whether it is derived from the business. So long money is recoverable from the parties or payable to the parties during the course of business the transactions have a direct nexus with the business and one cannot view these transactions away from the business. Such transactions include receipts and payment of money in cash or in kind immediately or on credit and are part of business activities. If the assessee has to make the payment to the above four parties, which were standing in the balance sheet as creditors and which have been claimed as business deduction in an earlier year then only course left to the assessee is either to make the payment or if no payment is legally required, to show as profit under section 41(1) which has been so done by the assessee. There is a clear and direct business connection of such cessation or remission and such profits taxable under section 41(1) can be held as derived from industrial undertaking. The arguments of the ld. DR that they are not current year's profit from manufacturing activity is devoid of any merit because deduction under section 80-IA is available only on profits derived from industrial undertaking which is carrying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion unit and Surat distribution unit. The assessee alternatively contended that if the benefit of deduction under section 80-IA is denied to it, then, the expenditure incurred by way of interest on such deposits should be netted off. 71.1 However, the AO found that the amount of interest income from the fixed deposits and IT refund are not arising from the activity of distribution of power. Therefore, the same is not eligible for deduction under section 80-IA of the Act. Likewise, the alternate contention for netting of the interest income is not maintainable for the reason that there was no nexus brought on record by the assessee suggesting that there was the expenditure incurred by the assessee against such fixed deposit in the form of interest. Thus, the AO was pleased to exclude the gross amount of interest income being from FD and IT refund from the amount eligible for deduction under section 80-IA of the Act. 72. Aggrieved assessee preferred an appeal to the learned CIT (A) who confirmed the order of the AO. 73. Being aggrieved by the order of the learned CIT (A), the assessee in appeal before us. 74. The learned AR before us contended that the interest was recov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... record by the learned AR or DR to demonstrate that the decision of Tribunal as discussed above has been set aside / stayed or overruled by the Higher Judicial Authorities. Before us, learned AR or DR has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of earlier year nor has placed any contrary binding decision in its support. Thus, respectfully following the order this tribunal in the own case of assessee, we hereby confirm the finding of the learned CIT(A). Thus, the ground of objection raised by the Assessee is hereby dismissed. 77. The next objection raised by the assessee vide ground no. 5 is that the learned CIT(A) erred in sustaining the disallowance of deduction claimed under section 80-IA of the Act for Rs. 5,36,138/- and Rs. 83,293/- representing Rental income with respect to Ahmedabad unit and Surat Unit. 78. The assessee has provided staff quarters to the employees against the rent who were engaged in the activity of power distribution. Accordingly, the assessee was of the view that such the receipt of rent cannot be segregated from the activity of power distribution. Thus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ible undertaking, cannot be construed as income derived from the activity of power distribution. It is for the reason that there is no immediate nexuses between the activity of power distribution and the rental income from the staff working for the eligible undertaking. The provisions of Section 80-IA of the Act provides for deduction of the profits derived from the business by an undertaking or enterprise, engaged inter alia, in generation or generation and distribution of power. But the rental income was not arising to the assessee from the activity of distribution of power. Thus, on the same reasoning given in the relation to streetlight maintenance activity in para no. 38 of this order, the impugned income is not eligible for deduction under section 80-IA of the Act. Thus in view of the above discussion we are of the opinion that the rental income received from employee should not be included in the computation of deduction under section 80IA of the Act as the same is not the profit or gain derived from the eligible business activity. 73.1 Before parting a question arises what about the depreciation claimed by the assessee with respect to such building being the staff quar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regarding incentive income or deduction from contractors bill for late submission but not established such claim with evidences hence it is held that such income is not eligible under section 80-IA of the Act. 87. Being aggrieved by the order of the learned CIT-A, the assessee is in cross objection before us. 88. The learned AR before us contended that the other misc. income being incentive, invoice TCD income, test report charges, excess amount recovered from GETCO are inextricably connected to the business of power generation. Hence,thesame should be allowed as deduction under section 80IA of the Act. 89. On the other hand, the learned DR vehemently supported the finding of the lower authorities. 90. We have heard the rival contentions of both the parties and perused the materials available on record. From the preceding discussion, we note that the assessee has shown miscellaneous receipts as income amounting to T 62,95,181/- only. The breakup of the same stands as under: Particulars Amount(Rs.) Incentive Income 1688995 Invoice TCD Income 14530 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The cost of the same separately recovered by the assessee from the AMC and the same was included the profit of eligible business. The AO was of the view such receipts are not related the assessee s eligible business of power distribution. Hence, the AO excluded the same from the computation of eligible profit under section 80-IA of the Act. 93. On appeal by the assessee, the learned CIT-A confirmed the finding of the AO by observing as under: The Appellant has carried out street light maintenance activity for AMC for which various material charges in form of bulbs, tube lights are separately recovered from AMC. The AO has treated such income of Rs.1,18,67,2067- as income not eligible for deduction under Section 80-IA on the ground that as street light maintenance income is not held as eligible for deduction, such income also cannot be subject matter of deduction. On the other hand, Appellant has argued that such income is part of distribution services as contended while dealing with income relating to street light maintenance hence such income is eligible for deduction. However, this contention of Appellant cannot be accepted for the reasons given by undersigned while adjudi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee in ground No. 8 and 9 of its CO is that the learned CIT-A erred in denying the benefit of deduction under section 80 IA of the Act with respect to certain incomes amounting to Rs. 4,60,516/-. 99. The assessee in the year under consideration has shown other income of Rs. 23,81,508 with respect to its different units. The details of the same stands as under: Particulars Amount (Rs.) A Surat Distribution 1 Income from shifting of services 328035 2. Refund against sales tax 141575 3. Capacitor Rent Recovery Charges 60473 4. Other Misc. Income 147270 677353 B Bhiwandi Distribution 1 Excess provision of d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 60,475, other miscellaneous income of Rs. 1,47,270 and excess provision for depreciation written back of Rs. 1,11,198/- are directly linked with the activity of generation and distribution of power. It is the trite law that the income, which has direct nexus with the activity of power generation and power distribution carried out by the assessee, are eligible for deduction under section 80IA of the Act. In other words, there has to be proximity between the income shown by the assessee viz a viz income derived from the activity of eligible undertaking. The onus lies upon the assessee to establish such nexus. However, what we find is this that the assessee before us failed to establish such nexus. Therefore, we decline to interfere in the order of the authorities below. Hence, the ground of objection raised by the assessee is hereby dismissed. Now coming to the additional ground of objection raised by the assessee. 105. At the outset, we note that the learned AR for the assessee at the time of hearing submitted that he has been instructed not to press the issue raised by the assessee in additional ground nos. 1 and 2 of its objection. Hence, the same are dismissed acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d earlier. 109.1 The view that the Tribunal is confined only to the issues arising out of the appeal before Commissioner (Appeals) is too narrow a view to describe the powers of the Tribunal. Undoubtedly, the Tribunal has the discretion to allow or not to allow a new ground to be raised. But where the Tribunal is only required to consider the question of law arising from the facts which are on record in the assessment proceedings, there is no reason why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee. 109.2 Since the claim of the assessee is purely legal claim and entire facts are available on records. Thus, it is not justified in not admitting the purely legal ground raised by the assessee for the first time. Hence, the additional ground of objection raised by the assessee is hereby admitted. 109.3 At the time of hearing, the learned AR on behalf of the assessee contended that the carbon credit being capital receipt should not be considered for the purpose of calculating the book profit under the provisions of section 115JB of the Act. The learned AR in support ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Coming to ITA No. 2047/Ahd/2018 an appeal by the Revenue for A.Y. 2013-14 113. The Revenue has raised the following grounds of appeal: 1) that the Ld. CIT (A) has erred in law and on the facts in treating the income from sale of CERs ascapital receipt and deleting the Disallowance of CERs of Rs. 41,45,02,512/- 2)that the Ld. CIT (A) has erred in law and on the facts in deleting the additions made while making certain adjustments from the profits of the eligible unite while computing the deduction u/s. 80IA of the l.T. Act as under:. (a) that the Ld. CIT (A) has erred in taw and on the facts in deleting the addition made on account of interest on delayed payment to customers on sale amounting to Rs. 3,49,84,75/- and delayed payment charges of Rs. 6,09,84,470/-. (b) that the Ld. CIT (A) has erred in law and on the facts in deleting the addition made on account of late delivery payment of Rs.11,30,229,/- and supplier's discount and penalty of Rs.1,06,07,952/-. (c) that the Ld. CIT (A) has erred in law and on the facts in deleting, the addition made on account of miscellenaneous receipts of Scrap Sales of Rs. 2,42,03,238;- (d) that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the year under consideration i.e. AY 2013-14. Hence, the ground of appeal filed by the Revenue is hereby dismissed. 116. The next issue raised by the Revenue in ground No. 2of its appeal is that the learned CIT (A) erred in allowing the deduction claimed by the assessee under section 80- IA of the Act with respect to certain incomes which are not eligible for deduction under section 80IA of the Act. 117. At the outset, the breakup of the other income raised in the ground of appeal stand as under: S.Nos. Heads of income Amount 1. Interest from customer on delayed payment Rs. 3,49,84,075/- 2. Delayed payment charges from customer Rs. 6,09,84,470/- 3. Income from shifting services Rs. 33,88,329/- 4. Liquidation damages Rs. 4,32,144/- 5. Misc. Income on sale of scrap Rs. 2,42,03,238/- 6. Supplier discount and penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. Hence, the AO excluded the receipt of Rs. 1,06,07,470/- Rs. 11,30,229/- from the income eligible for deduction under section 80IA of the Act. 120. On appeal by the assessee, the learned CIT-A deleted the disallowance of deduction made by the AO by observing as under: On careful consideration of the entire facts, it is observed the income in form of late delivery payment is inextricably linked with purchase cost of eligible unit and it reduces the cost incurred by appellant. Similarly, Supplier s Discount and Penalty is nothing but reduction of purchase cost made by appellant as it is towards prompt payment of transaction charges. Hon ble Delhi High Court in case of BSNL [73 taxmann.com 98] has held as under: Section 80-IA of the Income-tax Act, 1961 - Deductions - Profits and gains from infrastructure undertakings (Telecommunication services) - Assessment years 2004-05 to 2008-09 - Assessee was engaged in business of providing telecommunication services - It claimed deduction under section 80-IA in respect of profits and gains derived from following six items: extraordinary items, refund from universal service fund, interest from others, liquidated damages, excess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e on record. From the preceding discussion, we note that the assessee in connection with the purchases made by the eligible unit received the certain amount from the supplier on late delivery/supply of material. Thus, it appears that such receipt has direct link from the activity of generation and distribution of power. Besides the above, if the assessee reduces the cost of material purchase by the amount of late delivery charges, there would not have been any question of showing the impugned income and consequently denying the deduction claimed by the assessee under section 80 IA of the Act. It is just a manner of presentation of the income and expense. As such, the assessee has represented the late delivery charges separately as income instead of reducing the cost. Admittedly, the corresponding expenses i.e. material purchases has been allowed as deduction against the income from generation and distribution of power. Thus,it has a live link with the activity of the assessee. Accordingly, we hold that the assessee is eligible for deduction on such receipt of late delivery charges. 124.1 Moving forward, the supplier discount and penalty fetched by the assessee because of quick p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant has to supply the electricity to its client through GETCO and the details of such short fall and excesses are maintained by GETCO and the appellant is billed periodically. Considering these facts, it is clear that the activity being part of sale of electricity the income thereon has direct and proximate link with the core activity of the appellant. Accordingly, the claim of deduction u/s 80IA of the Act made by Appellant for UI income for Rs. 3,66,81,586 is allowed. Related ground of appeal is allowed. 127. The learned DR before us contended that the said income is not having direct nexus with the eligible business of the assessee. As such, the above said receipt is only incidental to the activity of the assessee. Hence, same cannot be allowed for deduction. 128. On the hand, the learned AR before us contended that impugned incomes are directly connected to the activity of power generation and distribution. Therefore, the same should be considered for the purpose of the deduction under section 80 IA of the Act. 129. We have heard the rival contentions of both the parties and perused the materials available on record. From the preceding discussion, wenote that in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DR before us contended that the said income is not having direct nexus with the eligible business of the assessee. As such, the above said receipt is only incidental to the activity of the assessee. Hence, same cannot be allowed as deduction. 133. On the hand, the learned AR before us contended that impugned incomes are directly connected to the activity of power generation and distribution. Therefore, the same should be considered for the purpose of the deduction under section 80 IA of the Act. 134. We have heard the rival contentions of both the parties and perused the materials available on record. From the preceding discussion, we note that the assessee was in receipt of an amount of Rs. 41,51,680/- from the meter fixing services, testing fee, fault attending fee etc. The AO held that the such receipts are not derived from the activity of the generation or distribution of power. At the outset, we note that electricity to the end customer cannot made available to the customer without fixing meter. Further, meter is necessary for measurement of unit supplied to particular customer and based on which bills are issued. Thus, in our considered opinion meter fixing services has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld as under: 5.9.3 The submission is considered. It is observed that Appellant has explained the nature of gain on foreign currency transactions during Assessment Proceedings hence AO is not correct in holding that such details were not submitted. So far as merits of the case is concerned, it is observed that gain on foreign exchange fluctuation is on account of different rates of exchange on the dates of transactions and the rate of exchange on the balance sheet date or settlement or liability which is nothing but revenue in nature and directly related to business operations carried out by industrial undertaking. In this connection, reliance is placed on the following decisions of Hon ble Gujarat High Court: (i) CIT vs Deversons Industries Ltd. [[2015] 55 taxmann.com 189] dated 18.12.2014: Section 80-IA of the Income-tax Act, 1961 Deductions Profits and gains from infrastructure undertakings (Computation of deductions) Assessment years 1995-96 to 2000-01 Appellant firm was engaged in business of manufacturing and sale of dyes Whether while computing deduction under section n80-IA, exchange rate difference should be treated to be derived from indust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f material, equipment and natural gas which were utilized in generation of power. Thus, the same has direct and live nexus with the eligible business. At this point, we also referred the judgment of Hon ble Gujarat High Court in case of CIT vs. Deverson Industries Ltd. reported in 55 taxmann.com 440 where it was held as under: 5. So far as question regarding foreign exchange difference is concerned, the same is squarely governed by the decision of this Court in the case of CIT v. Priyanka Gems [2014] 367 ITR 575/51 taxmann.com 259 (Guj.) wherein this Court has answered the question in favour of the assessee and held that that the foreign exchange gain arising out of the fluctuation in the rate of foreign exchange cannot be divested from the export business of the assessee and once export is made, due to variety of reasons, the remission of the export sale consideration may not be made immediately and that all foreign currencies received by the assessee need not be converted into Indian Rupees on the last date of the accounting period. 139.2 The above case law is in relation to export business whereas the case on hand of the appellant assessee has made import of materials an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e AY 2013-14 are identical to the issues raised by the Revenue in ITA No. 14/AHD/2018 for the assessment year 2012-13. Therefore, the findings given in ITA No. 14/AHD/2018 shall also be applicable for the year under consideration i.e. AY 2013-14. The appeal of the Revenue for the assessment 2012-13 has been decided by us vide paragraph No. 32 of this order against the Revenue. The learned AR and the DR also agreed that whatever will be the findings for the assessment year 2012-13 shall also be applied for the year under consideration i.e. AY 2013-14. Hence, the grounds of appeal filed by the Revenue is hereby dismissed. 146. The next issue raised by the Revenue in ground No. 6of its appeal is that the learned CIT (A) erred in deleting the addition made to the books profit u/s 115JB of the Act by the amount of Rs. 10,79,29,887/- being disallowance under section 14A read with rule 8D of Income Tax Rules. 147. At the outset, we note that the issues raised by the Revenue in its grounds of appeal for the AY 2013-14 are identical to the issues raised by the Revenue in ITA No. 14/AHD/2018 for the assessment year 2012-13. Therefore, the findings given in ITA No. 14/AHD/2018 shall als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... covery from employees 42,202/- Other Misc. Income 40,521/- Total Miscellaneous Income 1,28,50,949/- 3. On the facts and in the circumstances of the case, the learned CIT(A) erred in confirming the finding of the learned Assessing Officer under section 36(1 )(va) of the Act for Rs. 47,874/- on account of late payment of ESIC, hence no such disallowance is called for. 4. The respondent craves leave to add, alter, amend and/or withdraw any ground or grounds of cross objections either before or during the course of hearing of the same. 149.1 The assessee also filed additional grounds of objection vide letter dated 22-10-2021 which are as under: Appellant craves leave to raise this additional ground of Cross Objections before the Hon'ble ITAT. This is legal ground and therefore, as per the decision of Hon'ble Supreme court in the case of National Thermal Power (229 ITR 383), it can be raised before the Hon'ble ITAT. In view of the above, the appellant hereby raises following ground as additional ground of Cross Objections, which is with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the assessment year 2012-13 shall also be applied for the year under consideration i.e. AY 2013-14. Hence, the ground of cross objection filed by the assessee is hereby partly allowed. 154. The next objection raised by the assessee vide ground no. 3 is that the learned CIT(A) erred in sustaining the addition of employee s contribution to ESIC on account of late deposit. 155. At the outset, we note that the issues raised by the assessee in its grounds of cross objection is covered against the assessee by the order of the Hon ble Jurisdictional High Court in case of GSRTC reported in 366 ITR 170. Thus, respectfully following the same the ground of objection raised by the assessee is hereby dismissed. Now coming to additional grounds of objection 156. At the outset, we note that the learned AR for the assessee at the time of hearing submitted that he has been instructed not to press the issue raised by it (the assessee) in ground Nos. 1 and 2 of additional grounds of objection. Hence the same are dismissed accordingly as not pressed. 157. The assessee in the additional ground of objection bearing No. 3 has requested that the carbon credit of T 41,45,02,512/- bein ..... X X X X Extracts X X X X X X X X Extracts X X X X
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