Court dismisses appeal on Sales Tax Entitlement deduction. Windmill profits appeal admitted. Interest & admin expenses appeal dismissed.

The Court dismissed the appeal regarding the disallowance of deduction of Sales Tax Entitlement as no substantial question of law arose. The appeal concerning the disallowance of deduction under section 80IA for windmill profits was admitted for consideration. The Court declined to entertain the appeal on disallowance of interest expenditure and administrative expenses due to the minimal tax effect, dismissing the appeal but keeping the question of law open for future consideration.

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Issues:
1. Disallowance of deduction of Sales Tax Entitlement
2. Disallowance of deduction u/s 80IA of the Act for windmill profits
3. Disallowance of interest expenditure and administrative expenses

Analysis:
1. The first issue pertains to the disallowance of deduction of Sales Tax Entitlement. The Tribunal remanded the matter back to the Assessing Officer for re-adjudication based on directions given for a previous assessment year. The Court found no error in this decision, dismissing the appeal as no substantial question of law arose in this regard.

2. Moving on to the second issue, concerning the disallowance of deduction under section 80IA of the Act for profits derived from windmills, the Court admitted the appeal for consideration. This was due to similar issues being raised in appeals for previous assessment years by the same assessee. The substantial question of law to be considered was whether the ITAT was justified in deleting the addition made on account of disallowance of the deduction.

3. Lastly, the issue of disallowance of interest expenditure and administrative expenses was addressed. The Court noted that the tax effect involved was minimal at Rs.1,49,710. Due to the smallness of the amount, the Court declined to entertain the appeal regarding this issue. The appeal was dismissed in this regard, but the question of law was kept open for future consideration.

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