TaxTMI 
TaxTMI 
TaxTMI 
2018 (2) TMI 440
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....stion, stated to be a substantial question of law. "Whether the Appellate Tribunal has erred in law and on facts in deleting the disallowance made under section 80IA(4) of the Act?" 2. The assessment year is 2009-10 and the relevant accounting period is the previous year 2008-09. 3. The assessee, in its computation of income, claimed deduction of Rs. 37,80,015/- under section 80IA(4) of the Act. Such claim was made in respect of Captive Power Generation Plant (750 KV) at Rs. 37,60,542/- and in respect of Captive Power Generation Plant (250 KV) at Rs. 19,473/-. During the course of assessment proceedings, the assessee was asked to substantiate its claim for deduction under section 80IA (4) of the Act in respect of captive power plants. ....
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....nd No.2.1 and 2.2 were in relation to disallowance of deduction on the ground that the units in question were not separate undertakings. Ground No.2.3 was in relation to the profit of the undertakings being unreasonably high and Ground No.2.4 dealt with re-computing the profits of the undertaking by adjusting the sale value of the power produced and supplied by the undertakings. The Commissioner (Appeals) allowed the first ground of appeal, holding that the denial of deduction under section 80IA(4) of the Act due to captive power plants of the assessee not being separate undertakings, profits from them being notional and not included in the gross total income, was not tenable in view of the decision of this High Court in Ahmedabad Manufactu....
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....them being notional,and hence, not included in gross total income, etc., was not tenable in view of the decision of the Gujarat High Court in the case of Ahmedabad Manufacturing and Calico Printing Co. Ltd., wherein the court in the context of availability of deduction under section 80I, held that deduction under section 80I was available irrespective of the fact whether products were sold in open market or used for consumption by other units. The Commissioner (Appeals) observed that it was clear from provisions of section 80IA(8) of the Act that deduction under section 80IA is envisaged in respect of profits derived from inter unit transfer of goods/services as well. He, accordingly, held that deduction under section 80IA was available to ....
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....ted by the assessee at the rate of Rs. 5.00 per unit as against the market value of the electricity Rs. 4.51 per unit actually paid by the eligible business and considered by the Assessing Officer for computing deduction under section 80IA in conformity with the provisions of section 80IA(8) of the Act, since the eligible unit cannot recover more than the duty paid and held thus: "7. To our mind, Tribunal has committed no error. Assessing Officer and CIT (Appeals) while adopting Rs. 4.51 per unit as the value of electricity generated by eligible unit of assessee and supplied through its non eligible unit only worked out cost of such electricity generation. In fact CIT (Appeals) in terms recorded that Rs. 4.51 was computed as the reasonabl....