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TMI Blog2016 (1) TMI 117X X X X Extracts X X X X X X X X Extracts X X X X ..... e current income of the eligible business, Once the set off is taken place in earlier year against the other income of the assessee, the Revenue can not rework the set off amount and bring it notionally. Fiction created in sub-section does not contemplate to bring set off amount notionally. Fiction is created only for the limited purpose and the same can not be extended beyond the purpose for which it is created . See Velayudhaswamy Spinning Mills (P) Ltd. v. ACIT - [2010 (3) TMI 860 - Madras High Court ] - Decided against revenue. Incentive on carbon credit - whether is capital in nature? - Held that:- Similar issue was decided by the Andhra Pradesh High Court in the case of CIT v. My Home Power Ltd. (2014 (6) TMI 82 - ANDHRA PRADESH HIGH COURT), wherein it was held that income received from sale of carbon credit is considered as capital receipt and not business receipt and not liable for tax under the Act. Accordingly, we agree with the finding of the Commissioner of Income-tax(Appeals) on this ground and dismiss the ground of appeal taken by the Revenue. - Decided against revenue. - ITA No. 259/Mds/2015, C.O.No.42/Mds/2015 - - - Dated:- 6-10-2015 - SHRI CHANDRA POOJARI, A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rused the material on record. As submitted by the ld. AR, similar issue was considered and decided in favour of the assessee by this Tribunal in assessee s own case cited supra, wherein it was observed as under : 8. The issue here therefore boils down to whether power produced from TG-3 Boiler 4 and TG-4 Boiler 5 units were also eligible for deduction under Section 80- IA of the Act, on par with the wind farms. Contention of the Revenue is that these two units werean integral part of the main industrial undertaking of the assessee producing paper. A.O. himself at Sl.No.10 of the facing sheet of the assessment order has mentioned the nature of business of the assessee as manufacture and sale of newsprint, paper and generation of electricity. There is no dispute that TG-3 Boiler 4 and TG-4 Boiler 5 were turbo generators. There is also no dispute that such turbo units were placed within the main premises of the assessee from where its main manufacturing activity of production of paper was being carried on. Now the question is whether just because the turbo generators were placed inside the main industrial undertaking manufacturing paper, assessee could have been denied deduction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ming out of the orders of the authorities below whether the turbo generators where powered by diesel or powered by steam or powered by any other byeproducts produced by the assessee in the course of its main activity of producing paper. But, nevertheless this would not by itself be sufficient to hold that the turbo generators were not an undertaking by itself eligible for claiming deduction under Section 80-IA of the Act in respect of power generated therefrom used for captive consumption. Especially so, since steam based generating units, where steam was only an incidental output of main manufacturing activity, was held by the Hon'ble jurisdictional High Court in the case of Tanfac Industries Ltd. (supra) to be eligible for 80-IA deduction in respect of power generated and captively used. We are therefore of the opinion that the assessee is bound to succeed in these appeals. Its claim for deduction under Section 80-IA of the Act has to be allowed in respect of its power generated from TG-3 Boiler 4 and TG-4 Boiler 5 units as well. Since the facts of the present case are similar to the facts that considered by this Tribunal in earlier occasion, following the same, we dism ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, be allowed, in computing the total income of the assessee, a deduction of an amount equal to hundred per cent of the profits and gains derived from such business for ten consecutive assessment years.] (2) The deduction specified in sub-section (1) may, at the option of the assessee, be claimed by him for any ten consecutive assessment years out of fifteen years beginning from the year in which the undertaking or the enterprise develops and begins to operate any infrastructure facility or starts providing telecommunication service or develops an industrial park [or develops [***] a special economic zone referred to in clause (iii) of sub-section (4)] or generates power or commences transmission or distribution of power [or undertakes substantial renovation and modernisation of the existing transmission or distribution lines ): (4) This section applies to- (i) any enterprise carrying on the business [of (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining] any infrastructure facility which fulfils all the following conditions, namely :- (a) it is owned by a company registered in India or by a consortium of such co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... employed in sub-s(5) is different from the words beginning from the year referred to in sub-s(2) Important factors are to be noted in sub-s(5) and they are as under:- (1) It starts with non obstante clause which means it overrides all the provisions of the Act and other provisions are to be ignored. (2) It is for the purpose of determining the quantum of deduction; (3) For the Assessment Year immediately succeeding the initial Assessment Year; (4) It is a deeming provision; (5) Fiction created that the eligible business is the only source of income; and (6) During the previous year relevant to the initial assessment year and every subsequent assessment year. From reading the above, it is clear that the eligible business were the only source of income during the previous year relevant to initial assessment year and every subsequent assessment years. When the assessee exercises the option, the only losses of the years beginning from initial assessment year alone are to be brought forward and no losses of earlier years which were already set off against the income of the assessee. Looking forward to a period of ten years from the initial ..... X X X X Extracts X X X X X X X X Extracts X X X X
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