AGARWAL ENTERPRISES,PUNE vs. A.O, PUNE

ITA 1713/PUN/2025Status: DisposedITAT Pune16 February 2026AY 2023-24Bench: SHRI R. K. PANDA (Vice President), Ms. ASTHA CHANDRA (Judicial Member)8 pages
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What did the Tribunal hold?

The Tribunal determined that the total salary expense of Rs.41,27,199/- claimed by the assessee was correct and allowable. It directed the Assessing Officer to re-compute the deduction under Section 80IA by apportioning the salary expenses between the power generation unit and the share trading business based on their respective turnovers, considering this a scientific method.

What were the facts?

The assessee, Agarwal Enterprises, engaged in electricity generation and share trading, claimed a deduction of Rs.1,13,93,754/- under Section 80IA for AY 2023-24. The case was scrutinized to verify this first-year deduction, where the Assessing Officer (AO) initially accepted Rs.27,06,871/- out of Rs.41,27,199/- claimed salary expenses and allocated 50% to each business. The CIT(A) later allowed Rs.38,64,803/- of salary and allocated 1/4th to power generation and 3/4th to share trading.

What were the issues?

The key issues were the disallowance of a portion of salary expenses claimed by the assessee and the appropriate method for allocating common salary expenses between the eligible business (power generation) and other business (share trading) for Section 80IA deduction calculation.

Which sections of the Income-tax Act were involved?

Section 80IA,Section 143(2),Section 142(1),Section 37(1),Section 43B(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE

Before: SHRI R. K. PANDA & Ms. ASTHA CHANDRA

For Appellant: Shri Nikhil S Pathak
For Respondent: Shri Madan Thirmanpalli, Addl.CIT

PER ASTHA CHANDRA, JM:

This appeal filed by the assessee is directed against the order dated 13.06.2025 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2023-24. 2. Facts of the case, in brief, are that the assessee is a firm carrying on the business of electricity generation via windmill and solar plant. It filed its return of income on 30.09.2023 declaring total income of Rs.8,08,16,101/- after claiming Chapter VIA deduction of Rs.1,13,93,754/- u/s 80IA of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). The case was selected for scrutiny under CASS to verify the following reason: “First Year of Deduction claimed u/s 80IA/80IAB/80IAC/80IBA”

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Accordingly statuto

The order continues below.

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