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TMI Blog2022 (11) TMI 1416X X X X Extracts X X X X X X X X Extracts X X X X ..... te of electricity to SEB s as the market rate rejecting the department s finding that the rate adopted by Power Distribution Agencies is the market rate to be adopted. We note that the Tribunal in AY 2007-08 to AY 2009-10 has allowed assessee s appeal regarding this issue. Since the Ld.DR could not point out any change in facts or law vis a vis that of the earlier years as decided by the Tribunal in assessee s case as noted (supra), we are inclined to uphold the impugned action of CIT(A). Appeal of the Revenue stands dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 6158/M/10, 3021/M/13 & ITANO.3022/M/13 respectively) decided on 14.02.2018 wherein the Tribunal adjudicated this issue[assessee's appeal] wherein the grounds raised were as under:- Ground IV: Deduction u/s 80IA of the Act 1. On the facts and circumstances of the case and in law, the CIT (A) erred in not annulling the action of the AO of recalculating the deduction u/s. 80-IA of taking the price at which the power generated by the Appellant would he sold in the market as "Market Value" ant t reducing the Appellant's claim u/s. BO-IA of the Act by Rs.8.36,47,008/ 2. The appellant prays that the deduction u/s 80IA be allowed as claimed by the Appellant. 4. And the Tribunal decided the issue by allowing the same by holding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 017. It is also argued that there is no basis for taking adhoc 25% as mark up of cost price of Power Generating Agency for determining market value u/s 801A of the Act and appellant was not selling the power to the State Distribution Agency, therefore, the cost at which State Electricity Board purchases power was not relevant to the appellant. It is also argued that the Electricity Board was independent body in different States and different electricity boards purchase power from different generating units according to the requirement which cannot be the basis to determine the cost of power generated by the appellant. The appellant has considered the prevailing market price of power in the area at which the power rate is charged by M.P. Poo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other hand, the Ld. Representative of the Department has refuted the said contentions. Taking into account, facts and circumstances of the case, we noticed that the issue in question has duly been covered by the assessee's own case for the A.Y. 2006-07 decided by Hon'ble ITAT in ITA. No.115/M/2009 and 5473/M/2011 vide order dated 14.06.2017 in which it is specifically held that the market value of electricity sold/supplied as provided u/s 81A(8) can be adopted and the rate at which the assessee purchases electricity from the concerned state electricity board during the relevant period. When there is no other method to find out the market value, it is rational and reasonable to adopt the rate at which the State Electricity Board supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lants. The CIT u/s 263 alleged that the AO while allowing the assessee's claim under soc BOLA has not examined whether the market value of power generated by the captive power plants can be adopted on the basis of rate of electricity supplied by the respective SEB's. The ITAT held against this finding of CIT u/s 263. The ITAT held that on a perusal of material placed on record, during the course of assessment proceedings, AO has specifically enquired into the computation of deduction under sec 80IA in respect of power generation units. The assessee has furnished all necessary details relating to the computation of deduction and the basis for the rate applied for computing the quantity of electricity sold/supplied to Cement Units. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rroneous. Thus, one of the conditions of sec 263 is not satisfied. Relying on the decision of SC in Max India, the exercise of power under sec 263 to revise the assessment order cannot be sustained. Accordingly the impugned order of CIT(Appeals) was quashed and assessment order was restored. In effect the ITAT has adopted the selling rate of electricity to SEB's as the market rate rejecting the department's finding that the rate adopted by Power Distribution Agencies is the market rate to be adopted. Following this finding of the ITAT for AY 2006-07 in order dtd 14/6/2017, the 801A deduction disallowed by the assessing officer @Rs 2,92,15,387 is deleted. 6. We note that on this issue the Ld.CIT(A) has decided in favour of assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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