2025 (11) TMI 998

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....4 and 03.12.2024, relating to the assessment years 2017-18 and 2018-19, respectively. 2. Facts in brief are that the assessee filed its return of income on 30.11.2017 declaring total income of Rs. 12,72,65,320/-. A reference under section 92CA was made to the Transfer Pricing Officer (TPO) who, vide order dated 28.01.2021, proposed a downward adjustment of Rs. 22,18,09,187/- in relation to the claim of deduction under section 80IA. The Assessing Officer (AO), in the order passed u/s 143(3) r.w.s. 144C(3) dated 29.10.2021, assessed the income at Rs. 19,88,91,134/-, making two additions-(i) Rs. 4,26,45,814/- towards difference in deduction u/s 80IA, and (ii) Rs. 2,89,80,000/- towards disallowance u/s 40(a)(ia) for non-deduction of tax o....

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....in Jindal Steel & Power Ltd. [(2022) 460 ITR 162 (SC)] without appreciating that the Explanation to section 80IA(8) inserted by the Finance Act, 2012 required determination of market value as per the arm's length price mechanism prescribed under section 92F read with Rule 10B. He also relied upon the Judgments of the following judgments: 1. The Hon'ble Supreme Court order in M/s. SAP Labs [TS-225-SC-2023-TP] 2. ITAT Hyderabad order in the case of M/s. Sanghi Industries Limited 5. Per contra, the ld. Counsel submitted as under: In respect of deduction u/s.80IA-grounds 2 to 7 by the Appellant Revenue: The assessee submits that the order of the First Appellate Authority, while allowing the deduction claimed by the as....

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..../s.195, the Assessing Officer, in more than one place, invoked Sec.40(a)(ia) and the First Appellate Authority in the order u/s.250 dt.27.11.2024 in para-5.3, page-10, directed the Assessing Officer to delete the addition u/s.40(a)(i). The assessee, having complied with Sec.195(6) r.w. Rule 37BB, places reliance on decisions by ITAT, Chennai and ITAT, Delhi. 6. We have considered the rival submissions and perused the material available on record. The short issue for our consideration is whether the rate at which the assessee valued power generated and captively consumed should be the rate at which the State Electricity Board sells power to consumers or any other arm's length price determined under transfer pricing provisions. We find ....