DCIT Vs Baramati Agro Limited (ITAT Pune)
Summary: The Pune ITAT dismissed the Revenue’s appeal for Assessment Year 2021-22 concerning deduction under Section 80-IA and carried-forward MAT credit. Baramati Agro Ltd. had claimed deduction of ₹47,38,81,024 under Section 80-IA for its Shetphalgade and Kannad power-generation units, whereas the Assessing Officer restricted the deduction to the aggregate book profit of ₹40,95,00,569 and disallowed ₹6,43,80,455. The CIT(A) allowed the full claim by relying upon Section 80AB and the requirement that eligible profits be computed in accordance with the provisions of the Act, including Sections 28 to 43D. The Tribunal found no infirmity in that reasoning and relied upon CBDT Circular No. 37/2016, which addresses Chapter VI-A deductions on enhanced profits resulting from specified statutory disallowances, as well as the decision in Plastiblends India Limited Vs Addl. Commissioner of Income Tax, affirmed by the Supreme Court, concerning computation of Section 80-IA deduction after taking into account deductions allowable under Sections 30 to 43D. On the second issue, the Tribunal upheld the CIT(A)’s direction that the carried-forward MAT credit of ₹13,08,21,618 should not be reduced on the basis of the disputed Assessment Year 2020-21 assessment until the appellate proceedings for that year reach finality, and also upheld the direction to rectify the assessed book profit under Section 115JB after incorporating the relevant amalgamation adjustments and correcting the starting base figure. Accordingly, Grounds 1 to 3 and Ground 4 raised by the Revenue were dismissed and the Revenue’s appeal was dismissed in its entirety.
