| The Tax Publishers2022 TaxPub(DT) 5283 (Raip-Trib) INCOME TAX ACT, 1961
Section 80-IA(4)(iv)(a) Section 80-IA(8)
It is neither a fact nor the case of the department that order of the Tribunal was either set-aside or stayed by the High Court which would have otherwise justified the declining on its part to follow the same. Apart from that, there was absolutely no justification on part of AO in not following the binding judgment of the High Court in case of CIT v. Godawari Power & Ispat Ltd. [Tax Case No. 31, 32, 34 of 2012] : 2019 TaxPub(DT) 2352 (Chhattisgarh-HC) which seized the issue under consideration. Admittedly, department had assailed the aforesaid judgment of the High Court by filing a SLP before Supreme Court but again, as long as the said judicial pronouncement was not set aside or stayed, the same held the ground and was to be virtually followed by AO. Hence, there was no merit in declining the assessee's claim for deduction under section 80-IA(4)(iv)(a).
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Deduction under section 80-IA(4)(iv)(a) - Computation of - Power supplied by assessee to its steel division at prevailing rate in open market - AO applied provision of section 80-IA(8), however, CIT(A) vacated AO's action
Question arose for consideration was whether AO rightly triggered provisions of section 80-IA(8) by adopting the domestic purchase price of electricity by CSEB as the 'market rate' and justifiably scaled down assessee's claim for deduction under section 80-IA(4)(iv)(a) by an amount of Rs.4,38,75,880 lakhs. Assessee contended that the aforesaid issue as on date was squarely covered by the order of Tribunal assessee's own case for the assessment year 2008-09, i.e., Asstt. CIT-1(2) v. Mahindra Sponge and Power Ltd. in ITA No.159/BLPR/2011, dt. 19-6-2015. In its aforesaid order the Tribunal had after drawing support from the judgment of the High Court of Chhattisgarh in the case of CIT v. Godawari Power & Ispat Ltd., found favour with the claim of assessee and observed, that the 'market value' of power supplied by assessee to its steel division was rightly computed by considering the rate at which power was available in the open market, namely, the price that was charged by the Electricity Board. Held: It is neither a fact nor the case of the department that order of the Tribunal was either set aside or stayed by the High Court which would have otherwise justified the declining on its part to follow the same. Apart from that, there was absolutely no justification on part of AO in not following the binding judgment of the High Court in case of CIT v. Godawari Power & Ispat Ltd. [Tax Case No. 31, 32, 34 of 2012] : 2019 TaxPub(DT) 2352 (Chhattisgarh-HC) which seized the issue under consideration. Admittedly, department had assailed the aforesaid judgment of the High Court by filing a SLP before Supreme Court but again, as long as the said judicial pronouncement was not set aside or stayed, the same held the ground and was to be virtually followed by AO. Hence, there was no merit in declining the assessee's claim for deduction under section 80-IA(4)(iv)(a).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2013-14
INCOME TAX ACT, 1961
Section 14A Rule 8D
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