ANDHRA PRADESH POWER GENERATION CORPORATION LIMITED,VIJAYAWADA vs. DEPUTY COMMISSIONER OF INCOME TAX,CIRCLE1(1), VIJAYAWADA

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ITA 196/VIZ/2024Status: DisposedITAT Visakhapatnam20 August 2025AY 2018-19Bench: SHRI RAVISH SOOD, HON’BLE (Judicial Member)31 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the income from the sale of fly ash was not to be taxed as revenue income, considering the restrictions on its utilization as per government notifications. The disallowance under Section 40(a)(iib) was also allowed.

What were the facts?

The assessee, engaged in power generation, sold fly ash and realized proceeds which were deposited in an Environment Protection & Fly Ash Fund as per government notifications. The Assessing Officer added these proceeds to the total income, considering them as business revenue. The assessee argued that these funds were not free to be used for general business operations.

What were the issues?

Whether the proceeds from the sale of fly ash, subject to specific fund utilization rules, constitute taxable revenue income. Whether payments for water and security services to state government departments are disallowable under Section 40(a)(iib).

Which sections of the Income-tax Act were involved?

Section 143(3),Section 14A,Section 40(a)(iib),Section 37(1),Section 115JB

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Cases cited in this judgment(2)Show list

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Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM

आदेशकीप्रनतनलनपअग्रेनर्त/ Copy of the order forwarded to:-

1. 1. निर्धाररती/The Assessee Andhra Pradesh Power Generation Corporation Limited, 3rd : Floor, O/o. Managing Director, APGENCO, Vidyutsoudha, Gunadala, Vijayawada, Andhra Pradesh-520004. 2. रधजस्व/ The Revenue Deputy Commissioner of Income Tax, Circle-1(1), 2nd : Floor, Central Revenue Buildings, MG Road, Vijatyawada-520002, Andhra Pradesh.

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