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Trial Run Power Receipts Are Capital in Nature – ITAT Rejects Revenue’s Tax Claim
Case Law Details
- Case Name
- DCIT Vs Prayagraj Power Generation Company Limited (ITAT Lucknow)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2016-17
- Courts
- All ITAT, ITAT Lucknow
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DCIT Vs Prayagraj Power Generation Company Limited (ITAT Lucknow)
Revenue filed appeal against CIT(A)’s order deleting addition of ₹42.56 crore on account of infirm power sale during trial run & directing recomputation of book profit u/s 115JB.
AO had treated the receipt from sale of power generated during trial run as revenue income, thereby reducing returned loss & increasing book profit. He also added ₹2.72 crore as interest income. CIT(A) confirmed the interest income addition but deleted the addition of infirm power sale, holding it to be a capital receipt, since the trial r...
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