DODSON LINDBLOM HYDRO POWER PRIVATE LIMITED,MUMBAI vs. DCIT, AAYAKAR BHAVAN

ITA 3472/MUM/2026Status: DisposedITAT Mumbai30 June 2026AY 2016-174 pages
AI SummaryAllowed

What were the facts?

The assessee earned Rs. 19,96,678 from the sale of carbon credits and treated it as a capital receipt. The Assessing Officer, however, taxed it as business income, citing Section 115BBG. The CIT(A) upheld this decision.

What did the Tribunal hold?

The Tribunal held that Section 115BBG, introduced by the Finance Bill, 2017, is effective from AY 2018-19 and thus not applicable to the impugned AY 2016-17. Furthermore, the sale of carbon credits was held to be a capital receipt, consistent with High Court decisions.

What were the issues?

Whether income from the sale of carbon credits is a capital or revenue receipt for AY 2016-17, and whether Section 115BBG was correctly applied.

Which sections of the Income-tax Act were involved?

Section 115BBG,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH: MUMBAI

Hearing: 23.06.2026Pronounced: 30.06.2026

PER VIKRAM SINGH YADAV, A.M.:

This is an appeal filed by the Assessee against the order of the Learned Commissioner of Income Tax (Appeals), ADDL/JCIT (A)-2 Chennai [‘Ld.CIT(A)’], dated 22.01.2026, pertaining to Assessment Year (AY) 2016-17, wherein the Assessee has taken the following grounds of appeal:

“1. The ACIT erred in assessing the amount received from sale of carbon credit of Rs.19,96,678 as a revenue receipt. The Appellants submit that the Income from sale of carbon credit (CER) is a capital receipt and therefore pray that the ACIT be directed to consider the receipt from sale of carbon credit as a capital rece

The order continues below.

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