The Pr. Commissioner Of Income Tax-9, Mumbai v. M/S. Dodson Lindblom Hydro Power Pvt. Ltd

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.1820 OF 2016 The Pr. Commissioner of Income Tax-9, Mumbai Versus M/s. Dodson Lindblom Hydro Power Pvt. Ltd. : Appellant. : Respondent. WITH INCOME TAX APPEAL NO.1821 OF 2016 The Pr. Commissioner of Income Tax-9, Mumbai: Appellant.Versus M/s. Dodson Lindblom Hydro Power Pvt. Ltd. : Respondent. WITH INCOME TAX APPEAL NO.1840 OF 2016 The Pr. Commissioner of Income Tax-9, Mumbai VersusM/s. Dodson Lindblom Hydro Power Pvt. Ltd. : Appellant. : Respondent. Mr. Tejveer Singh for the Appellant. Mr. Madhur Agrawal a/w Mr. Bharat Damodar I/by Kanga & Co. for theRespondent. CORAM : AKIL KURESHI & M.S.SANKLECHA, JJ. DATE : FEBRUARY 27, 2019. P.C.: 1All these appeals have been filed by the Revenue challenging the orders passed by the Income Tax Appellate Tribunal. 2 The issues involved in these Appeals are common. The Respondent-Assessee in all these Appeals is also common. We may refer tofacts from Income Tax Appeal No.1820 of 2016. 3Income Tax Appeal No.1820 of 2016 relates to Assessment Year2007-2008. Revenue has urged the following questions for ourconsideration :- (i)Whether on the facts and in the circumstances of the case and inlaw, the Hon'ble ITAT, is correct in holding that sale of carboncredit is to be considered as Capital Receipt and not liable for taxunder any head of income under Income Tax Act, 1961?law, the Hon'ble ITAT, is correct in holding that sale of carboncredit is to be considered as Capital Receipt and not liable for taxunder any head of income under Income Tax Act, 1961? (ii) Whether on the facts and in the circumstances of the case and inlaw, the Hon'ble ITAT, is correct in holding that there is no cost ofacquisition or cost of production to get entitlement for the CarbonCredits, without appreciating that generation of Carbon Credits isintricately linked to the machinery and processes employed in theproduction process by the assessee?law, the Hon'ble ITAT, is correct in holding that there is no cost ofacquisition or cost of production to get entitlement for the CarbonCredits, without appreciating that generation of Carbon Credits isintricately linked to the machinery and processes employed in theproduction process by the assessee? 4Though two questions are framed, singular issue is whether thereceipts of the Assessee arising out of sale of carbon credit is to be consideredas capital receipt and therefore not liable to tax. This issue is considered bythe several High Courts starting from the judgment of Andhra Pradesh HighCourt in the case of Commissioner of Income Tax v/s. My Home Power Ltdreported in (2014) 365 ITR 82 (AP)holding the receipts to be capital innature. This was further elaborated by the Division Bench of Karnataka HighCourt in the case of Commissioner of Income Tax v/s. Subhash Kabini PowerCorporation Ltd. reported in (2016) 385 ITR 592 (Karn) and followed by Allahabad High Court and Rajasthan High Court, (Allahabad High Courtdecision is in the case of Principal Commissioner of Income Tax v/s. L HSugar Factory Pvt. Ltdreported in (2017) 392 ITR 568 (All)). 5In view of such consistent view of the different High Courts in thecountry, we see no reason to take a different stand. No question of law arisesin these Appeals. Hence not entertained. The Income Tax Appeals aredismissed. [ M.S.SANKLECHA,J.] [ AKIL KURESHI, J ]