2021 (11) TMI 75

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....4-15. Grounds No. 1 to 6 raised in the appeal of the Revenue are relating to the receipt in respect of Renewal Energy Certificates akin to carbon receipts amounting to Rs..6,37,37,141/- [wrongly mentioned as Rs..6,37,73,141/-] is whether capital receipt or revenue receipt. 2. In the assessment order, the Assessing Officer has held that as per section 2(24)(vd) read with section 28(iv) of the Income Tax Act, 1961 ["Act" in short, the value of any benefit or perquisite is taxable and clearly carbon credits is a benefit received by the assessee is taxable as revenue receipt under the head 'business and profession' and is not capital receipt or capital subsidy. Accordingly, the entire REC receipt of Rs..6,37,37,141/- 3. On appeal, by followin....

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.... in the case of CIT v. Ambika Cotton Mills Ltd. [2021] 125 taxmann.com 206 (Madras)/433 ITR 193 and submitted that the amount received by the assessee is a capital receipt. 6. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below including the case law relied on. The point at issue for consideration is whether the Renewal Energy Certificates akin to carbon receipts is capital receipt or revenue receipt. The Hon'ble Jurisdictional High Court in the case of CIT v. Ambika Cotton Mills Ltd. (supra) has held that the proceeds received by the assessee company carrying on business of power generation on sale of certified emission reduction credit (carbon credit) is a capital recei....

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.... sum payable by the assessee as an employer by way of contribution to any fund such Provident Fund shall be allowed, if it is paid on or before the due date as contemplated under Section 139(1) of the I.T. Act". This law has been reiterated by several High Courts viz. the Karnataka High Court in the case of M/s Essae Teraoka Pvt Ltd. vs. DCIT [246 CTR 286], Rajasthan High Court on CIT vs. State Bank of Bikaner and Jaipur [2014] 363 ITR 70, CIT vs. Jaipur Vidhyut Vitaran Nigam Ltd. [(2014) (5) TMI 222], Bombay High Court in CIT vs Nipso Fabriks Ltd. [350 ITR 327] etc. 6.2 Further, in a recent decision in the case of Principal Commissioner of Income Tax, Jaipur vs. Rajasthan State Beverages Corporation Ltd. Reported in [2017] 250 Taxman 16/....