The ITAT held that the transfer price of steam-generated...

The ITAT held that the transfer price of steam-generated electricity from an eligible unit to a non-eligible unit must be determined based on the market value charged by State Electricity Boards or distribution companies to end consumers, in accordance with the Electricity Act framework. Since the appellant's boilers generated steam solely for captive consumption and no external sale of steam occurred, the pricing cannot be arbitrary but must reflect regulated electricity tariffs. Consequently, the AO was directed to recompute eligible profits under Section 80IA(8) by applying the electricity rates charged by the respective distribution companies in the relevant states. The appeal was partly allowed to this extent, ensuring the transfer pricing adjustment aligns with statutory electricity pricing norms rather than internal transfer valuations.