DCIT, RANGE-3, LUCKNOW vs. M/S. PRAYAGRAJ POWER GENERATION COMPANY LTD.,, NOIDA

ITA 393/LKW/2020Status: DisposedITAT Lucknow15 October 2025AY 2016-17Bench: SHRI KUL BHARAT (Vice President), SHRI ANADEE NATH MISSHRA (Accountant Member)4 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal agreed with the CIT(A) that the income from infirm power sale during the trial run is a capital receipt and thus deleted the addition. However, it directed the AO to recompute the book profit under Section 115JB by including the confirmed interest income.

What were the facts?

The assessee company received income from the sale of infirm power during the trial run of its power plant. The Assessing Officer (AO) made an addition for this amount and also for interest income. The Commissioner (Appeals) deleted the addition for infirm power sale but confirmed the addition for interest income.

What were the issues?

Whether income from sale of infirm power during trial run is a capital receipt, and how book profit should be computed under Section 115JB when certain income is confirmed.

Which sections of the Income-tax Act were involved?

Section 115JB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, LUCKNOW BENCH ‘B’, LUCKNOW

Before: SHRI KUL BHARAT & SHRI ANADEE NATH MISSHRA

For Appellant: Shri Puneet Kumar, CIT (D.R.)

PER ANADEE NATH MISSHRA:A.M.

(A) This appeal vide I.T.A. No.393/Lkw/2020 has been filed by Revenue pertaining to assessment year 2016-17 against impugned appellate order dated 14/08/2020 passed by learned Commissioner of Income Tax (Appeals) [“CIT(A)” for short]. Revenue has raised the following grounds:

“1. Under the facts and circumstances of the case, the Ld. CIT(A) has erred in law and facts in deleting the addition of Assessment Year:2016-17 2

Rs.42,56,57,616/- on account of infirm power sale which has been produced during the course of trial run and trial run can be made only after the plant and machinery has been completely set up which means that the process of trial ru

The order continues below.

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