Consistency key in ITAT ruling on deduction for steam sale profit under section 80Ia.

The ITAT upheld the CIT(A)'s decision to delete the disallowance of deduction u/s. 80Ia on profit from the sale of steam. The ITAT emphasized consistency in decisions, noting that the AO's acceptance of steam as eligible for deduction contradicted the disallowance made on an assumption basis. Relying on legal precedents and supporting evidence, the ITAT ruled in favor of the assessee, dismissing the Revenue's appeal. The judgment highlighted the importance of consistency and upheld the CIT(A)'s reasoned order.

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Issues Involved:
Appeal against CIT(A) order regarding disallowance of deduction u/s. 80Ia on profit from sale of steam.

Detailed Analysis:

1. Issue of Disallowance of Deduction u/s. 80Ia:
The Revenue appealed against the CIT(A) order deleting the disallowance of deduction u/s. 80Ia of the Income Tax Act on account of profit from the sale of steam amounting to Rs. 2,81,35,809. The AO disallowed this amount as profit earned on the sale of steam while calculating deduction under S. 80IA of the Act. The AO's stance was that no deduction under S. 80IA was admissible on the sale of steam used for consumption in another unit. The CIT(A) partly allowed the appeal based on the precedent set in the assessment year 2012-13, where the appeal was allowed on similar grounds. The Revenue contended that the matter was covered by a co-ordinate bench's order for A.Y. 2011-12 in the assessee's case, which upheld the deduction on steam as power under S. 80IA(4) of the Act.

2. Judgment and Conclusion:
The ITAT upheld the CIT(A)'s decision to delete the disallowance of deduction u/s. 80Ia on profit from the sale of steam. The ITAT noted that the AO's acceptance that steam was eligible for deduction under S. 80IA(4) contradicted the disallowance made on an assumption basis. Relying on various decisions, including an engineer's certificate and case laws, the ITAT found the CIT(A)'s order to be detailed and reasoned. The ITAT emphasized consistency in decisions and upheld the CIT(A)'s order, dismissing the Revenue's appeal. The principle of consistency was highlighted as the basis for denying relief to the Revenue, given the relief granted to the assessee in similar circumstances by the CIT(A) and ITAT in previous cases.

In conclusion, the ITAT ruled in favor of the assessee, dismissing the appeal filed by the Revenue against the CIT(A)'s order regarding the disallowance of deduction under S. 80Ia on profit from the sale of steam. The judgment emphasized the importance of consistency in decisions and upheld the CIT(A)'s reasoned order based on legal precedents and supporting evidence presented by the assessee.

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