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Carbon Credit sale receipt is Capital Receipt & Not Liable to Tax
Case Law Details
- Case Name
- DCIT Vs Bhoruka Power Corporation Ltd. (ITAT Bangalore)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2010-11
- Courts
- All ITAT, ITAT Bangalore
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DCIT Vs Bhoruka Power Corporation Ltd. (ITAT Bangalore)
The issue under consideration is whether receipt on account of sale of carbon credit is Revenue Receipt or Capital Receipt?
ITAT states that carbon 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 is 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 ...
