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TMI Blog2025 (2) TMI 766X X X X Extracts X X X X X X X X Extracts X X X X ..... of taking a decision on merits, we need not labour much as we are guided by the decision of the Hon'ble Supreme Court in Jindal Steel and Power Limited. [2023 (12) TMI 417 - SUPREME COURT] as held that market value of the power supplied by the State Electricity Board to the industrial consumers should be construed to be the market value of electricity. It should not be compared with the rate of power sold to or supplied to the State Electricity Board since the rate of power to a supplier cannot be the market rate of power sold to a consumer in the open market. The State Electricity Board's rate when it supplies power to the consumers have to be taken as the market value for computing the deduction u/s 80-IA of the Act. We hold that the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etch in the open market; or (b) the arm's length price as defined in clause (ii) of section 92F, where the transfer of such goods or services is a specified domestic transaction referred to in section 92BA? b) WHETHER in facts of the case and in law, the Hon'ble ITAT is justified in not appreciating the finding of the TPO that the assessee's generating unit cannot as such claim any benefit under section 80IA of the Income Tax Act computed on the basis of rates charged by the distribution licensee from the consumer. The benefit can only be claimed on the basis of the rates fixed by the tariff regulation commission for sale of electricity by the generating companies to the distribution company? 3. We have heard Ms. Smita Das De, learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court, the assessee before us having found that the electricity supplied by the State Electricity Board was inadequate to meet the requirement of its industrial unit, they set up captive power generating unit to supply electricity to its industrial unit which was done at a particular rate. The surplus power, if any, generated was to be wheeled out to the Electricity Board grade pursuant to an agreement between the State Electricity Board and the assessee at a rate fixed by the State Electricity Board. The question which arose for consideration is that as to the quantum of deduction which the assessee would be entitled to claim under Section 80IA of the Act. The assessing officer did not accept the case of the assessee that the marke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of an order passed by the Hon'ble Division Bench of this Court in the case of CIT Vs. ITC reported at [2015] 64 taxmann.com 214 (Cal.). In fact, the appeals were heard along with the bunch of appeals and the appeal against the decision in ITC Ltd. by the Hon'ble Division Bench of this Court was CA No. 9920/2016 which was filed by the assessee and which was allowed by the Hon'ble Supreme Court and this aspect was clarified by the Hon'ble Supreme Court upon mentioning by order dated 7.12.2023. At this juncture, it will be beneficial to note the law laid down by the Hon'ble Supreme Court as regards computation of the market value of the power supplied by the assessee to its industrial units from the captive power generating plant, should it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r to the consumers have to be taken as the market value for computing the deduction under section 80-IA of the Act. 31. That being the position, we hold that the Tribunal had rightly computed the market value of electricity supplied by the captive power plants of the assessee to its industrial units after comparing it with the rate of power available in the open market, i.e., the price charged by the State Electricity Board while supplying electricity to the industrial consumers. Therefore, the High Court was fully justified in deciding the appeal against the Revenue." 6. In the light of the above decision, the appeal filed by the revenue has to necessarily fail. Accordingly, the appeal is dismissed and the substantial questions of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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