Case Law Details
DCIT Vs Bannari Amman–Sugars Ltd. (ITAT Chennai)
ITAT Chennai held that disallowance of deduction u/s 80IA of the Income Tax Act unsustainable as cost of power imported is charged before computing income eligible for deduction u/s 80IA.
Facts- The assessee is a limited company engaged in the business of manufacturing of sugar, alcohol, granite and cogeneration of power. Case of the assessee was selected for scrutiny. The assessment has been completed after making various disallowance and additions amounting to Rs.3,14,60,641/-.
Aggrieved, the assessee preferred an appeal before the Ld.CIT(A) and succeeded. Now the Revenue is in appeal before this Tribunal, challenging the findings of the Ld.CIT(A).
It is alleged that the assessee has claimed deduction u/s.80IA of the Act, at Rs.102,70,48,360/- against income from generation of power from 5 independent power generation undertaking units. Ld.AO noticed that the assessee has purchased power units from the grids of TNEB & KPTCL totaling to Rs.1,85,19,868/-. Ld.AO was of the opinion that since for the said amount assessee has not generated power and has purchased it from other power units. This amount does not represent the value of own power generation and therefore, the same should be reduced from the claim made u/s.80IA of the Act.
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