CIT v. Karnataka Power Corporation

247 ITR 268Supreme Court of India2001#837 most cited

What is CIT v. Karnataka Power Corporation authority for?

Income earned during the project construction stage, which has a direct nexus or is inextricably linked to the project's setting up, constitutes a capital receipt not liable to tax and reduces the project cost.

124

judgments rely on this decision, according to BharatTax’s citation analysis of 366,418 Indian tax judgments — from 2011 to 2026.

Also referred to as

CIT v. Karnataka Power Corporation · 247 ITR 268 · Supreme Court · income during construction · project cost reduction · capital receipt · not taxable · inextricably linked · capital work-in-progress · section 37(1) · section 32(1)(ii) · Bokaro Steel principle

Sections most often in play

Section 37(1)Section 40A(2)(b)Section 139(1)Section 143(3)Section 234ASection 244ASection 32(1)(ii)Section 37

Issues it is cited on

section 3asection 120(4)(b)section 4asection 36(1)(v)section 35esection 10(20)section 61section 46section 10(5)section 40a(7)section 92esection 92ba

Judgments citing CIT v. Karnataka Power Corporation

DCIT 8(2), Mumbai vs. Mumbai Internaiotnal Airport P.Ltd, Mumbai

In the result, assessee’s appeals are statistically allowed and revenue’s

ITA 4675/MUM/2013[2009-10]Status: DisposedITAT Mumbai13 Nov 2017AY 2009-10

Bench: Shri P K Bansal & Shri Pawan Singh

For Appellant: Shri Vijay MehtaFor Respondent: Shri Anand Mohan
Section 14ASection 40

…ase of an operation theatre in the hospital, it has been held to be a part of plant and not a part 18 Mumbai International Airport P Ltd. of building. Ld. AR referred the decision of the Hon’ble Apex Court in the case of CIT V/s Karnataka Power Corpn. (2000) 247 ITR 268 (SC) and submitted that the power generating station building is held to be a plant. He submitted that such structures are specific for the purpose of business of the assessee and the assessee is entitled for depreciation at rate as applicable to plant and machinery. 34. On the other hand, ld. DR supported the orders of authorities below. He subm…

Mumbai International Airport P.Ltd, Mumbai vs. Addl CIT RG 8(20, Mumbai

In the result, assessee’s appeals are statistically allowed and revenue’s

ITA 1081/MUM/2013[2009-10]Status: DisposedITAT Mumbai13 Nov 2017AY 2009-10

Bench: Shri P K Bansal & Shri Pawan Singh

For Appellant: Shri Vijay MehtaFor Respondent: Shri Anand Mohan
Section 14ASection 40

…ase of an operation theatre in the hospital, it has been held to be a part of plant and not a part 18 Mumbai International Airport P Ltd. of building. Ld. AR referred the decision of the Hon’ble Apex Court in the case of CIT V/s Karnataka Power Corpn. (2000) 247 ITR 268 (SC) and submitted that the power generating station building is held to be a plant. He submitted that such structures are specific for the purpose of business of the assessee and the assessee is entitled for depreciation at rate as applicable to plant and machinery. 34. On the other hand, ld. DR supported the orders of authorities below. He subm…

ITO, Bangalore vs. M/S Bank Note Paper Mills India Pvt. Ltd., Bangalore

In the result, Revenue’s appeal for asst

ITA 1162/BANG/2016[2012-13]Status: DisposedITAT Bangalore10 Nov 2017AY 2012-13

Bench: Shri Sunil Kumar Yadav & Shri Jason P Boazthe Income-Tax Officer, Ward-1(1)(3), Bengaluru. . Appellant Vs. M/S Bank Note Paper Mill India Pvt. Ltd., 1St Floor, S.R Complex, No.2, Thavarekere Main Road, S.G Palya, Drc Post, Bengaluru. . Respondent Pan – Aaecb3245M Appellant By : Shri B.R Sunil Kumar Singh, Cit Respondent By : Smt. Prathiba, Advocate Date Of Hearing : 7-11-2017 Date Of Pronouncement : -11-2017 O R D E R

For Appellant: Shri B.R Sunil Kumar Singh, CITFor Respondent: Smt. Prathiba, Advocate
Section 143(3)

…ed. The more appropriate decision in the factual situation in the present case is in CIT V Bokaro Steel Ltd. (1999) 236 ITR 3152 (SC). The appeal is dismissed. There will be no order as to costs". 6.6 In the case of CIT Vs Karnataka Power Corporation ( 2001 ) 247 ITR 268 (SC), the ITA No.1162/B/16 6 Supreme Court following its own decision in the case of Bokaro Steel ( Supra) held that interest receipts and hire charges from contractors are capital receipts which would go to reduce capital cost. 6.7 In the case of Bongaigaon Refinery and petro Chemicals Ltd Vs CIT ( 2001) 251 ITR 329, the Supreme court followed…

DCIT, New Delhi vs. M/S. Bokaro Power Supply Co. Ltd., New Delhi

In the result, appeal of the assessee is partly allowed whereas the appeal of the Revenue is dismissed

ITA 3692/DEL/2014[2010-11]Status: DisposedITAT Delhi31 Oct 2017AY 2010-11

Bench: Sh. Amit Shukla & Sh. O.P. Kantassessment Year: 2010-11 Vs. Dcit, Circle -3(1), New Delhi M/S. Bokaro Power Supply Co. Ltd., Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) & Assessment Year: 2010-11 Vs. M/S. Bokaro Power Supply Co. Dcit, Circle -3(1), New Delhi Ltd., 4Th Floor, Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) Assessee By Sh. M.P. Rastogi, Adv. & Sh. Anil Sharma, Agm Respondent By Sh. Sandip Kumar Mishra, Sr.Dr Date Of Hearing 11.10.2017 Date Of Pronouncement 31.10.2017 Order Per O.P. Kant, A.M.:

Section 143(2)Section 143(3)Section 43B

…other sources. "Indian Oil Panipat Power Consortium Ltd." (supra) is squarely applicable to the present Case, as discussed. This is in consonance with "Bokaro Steel Ltd." (supra), "Karnal Cooperative Sugar Mill" (supra), "CIT Vs. Karnataka Power Corporation", 247 ITR 268 (SC) and "Bongaigaon Refinery and Petro Chemical Co. Ltd. vs. CIT", 251 ITR 329 (SC), wherein also, it has been laid down that any receipt inextricably linked to the setting up of the project is capital receipt not liable to tax and going to reduce the cost of the project, in the present case too, the funds infused by the assessee company were in…

Bokaro Power Supply Co. Ltd., New Delhi vs. DCIT, New Delhi

In the result, appeal of the assessee is partly allowed whereas the appeal of the Revenue is dismissed

ITA 3405/DEL/2014[2010-11]Status: DisposedITAT Delhi31 Oct 2017AY 2010-11

Bench: Sh. Amit Shukla & Sh. O.P. Kantassessment Year: 2010-11 Vs. Dcit, Circle -3(1), New Delhi M/S. Bokaro Power Supply Co. Ltd., Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) & Assessment Year: 2010-11 Vs. M/S. Bokaro Power Supply Co. Dcit, Circle -3(1), New Delhi Ltd., 4Th Floor, Ispat Bhavan, Lodhi Road, New Delhi Pan : Aabcb8976G (Appellant) (Respondent) Assessee By Sh. M.P. Rastogi, Adv. & Sh. Anil Sharma, Agm Respondent By Sh. Sandip Kumar Mishra, Sr.Dr Date Of Hearing 11.10.2017 Date Of Pronouncement 31.10.2017 Order Per O.P. Kant, A.M.:

Section 143(2)Section 143(3)Section 43B

…other sources. "Indian Oil Panipat Power Consortium Ltd." (supra) is squarely applicable to the present Case, as discussed. This is in consonance with "Bokaro Steel Ltd." (supra), "Karnal Cooperative Sugar Mill" (supra), "CIT Vs. Karnataka Power Corporation", 247 ITR 268 (SC) and "Bongaigaon Refinery and Petro Chemical Co. Ltd. vs. CIT", 251 ITR 329 (SC), wherein also, it has been laid down that any receipt inextricably linked to the setting up of the project is capital receipt not liable to tax and going to reduce the cost of the project, in the present case too, the funds infused by the assessee company were in…

DCIT, New Delhi vs. M/S. Ntpc- Sail Power Co. Pvt. Ltd., New Delhi

In the result, appeal of the Revenue is dismissed

ITA 5717/DEL/2014[2010-11]Status: DisposedITAT Delhi26 Sept 2017AY 2010-11

Bench: Shri N.K. Saini & Shri K.N. Chary

Section 115JSection 36(1)(iii)Section 43B

…nt of net provision of retirement benefits by disallowing the same. In appeal Ld. CIT (A) deleted both these additions by following the decisions reported in CIT vs. Bokaro Steels Ltd. (SC) (1999) 236 ITR 315, CIT vs. Karnataka Power Corporation (SC) [2001] 247 ITR 268, Indian Oil Panipat Power Consortium Ltd. vs. ITO (2009) 315 ITR 255 (Del.) and decision of Hon’ble Jurisdictional Delhi High Court in appellant’s own case of NTPC Sail Power Company (P) Ltd. vs. CIT in ITA No. 1238/2011 in decision dated 17/07/2012 for the AY 2007-08 on identical issue in respect of the addition of interest, and Calcutta Co.…

ACIT, Madurai vs. Bhima Jewellery, Madurai

In the result, the appeals of the Revenue stand dismissed

ITA 109/CHNY/2017[2011-12]Status: DisposedITAT Chennai31 May 2017AY 2011-12

Bench: Shri Abraham P. George & Shri G. Pavan Kumarआयकर अपील सं./I.T.A. No. 108/Mds/2017 "नधा"रण वष" /Assessment Year : 2011-2012

For Appellant: Mrs. Ilavarasi, Addl. CIT
Section 131(1)Section 32Section 32(1)

…usiness or theatre business. On the other hand these can be deemed only a part of a windmill for harnessing wind energy. In coming to this conclusion we are fortified by decision of Hon'ble Karnataka High Court in the case of CIT v Kamataka Power Corporation (247 ITR 268) where it was held that whether the building can be treated as a plant or not. it was a question of fact and when it is found as a fact that the building has been so planned and constructed as to serve the assessee's special technical requirement, it would qualify to be treated as a plant. In our opinion, the expenses relating to the land and fou…

ACIT, Madurai vs. Bhima Jewellery, Nagercoil

In the result, the appeals of the Revenue stand dismissed

ITA 108/CHNY/2017[2011-12]Status: DisposedITAT Chennai31 May 2017AY 2011-12

Bench: Shri Abraham P. George & Shri G. Pavan Kumarआयकर अपील सं./I.T.A. No. 108/Mds/2017 "नधा"रण वष" /Assessment Year : 2011-2012

For Appellant: Mrs. Ilavarasi, Addl. CIT
Section 131(1)Section 32Section 32(1)

…usiness or theatre business. On the other hand these can be deemed only a part of a windmill for harnessing wind energy. In coming to this conclusion we are fortified by decision of Hon'ble Karnataka High Court in the case of CIT v Kamataka Power Corporation (247 ITR 268) where it was held that whether the building can be treated as a plant or not. it was a question of fact and when it is found as a fact that the building has been so planned and constructed as to serve the assessee's special technical requirement, it would qualify to be treated as a plant. In our opinion, the expenses relating to the land and fou…

DCIT, Chennai vs. Neyveli Lignite Corporation Limited, Neyveli

In the result, the appeals of the Revenue as well as the appeal of the assessee are partly allowed

ITA 855/CHNY/2013[2009-2010]Status: DisposedITAT Chennai28 Apr 2017AY 2009-2010

Bench: Shri N.R.S. Ganesan & Shri D.S.Sunder Singh

…ies as submitted by the appellant and the ‘special technical requirement’ demands such facilities as indispensible, it should be treated as “plant” and depreciation at the rate of 15% should be allowed. The case law of CIT v Karnataka Power Corporation (2001) 247 ITR 268 (SC) relied on by the appellant will come to its rescue wherein it is decided that if it serves an assessee’s special technical requirement’, it will qualify to be treated as plant. The case law relied on by the AO in the case of CIT vs. Anand Theatres (2000) (244 ITR 192) wherein the cinema theaters were not considered as “plant” was also discus…

Neyveli Lignite Corporation Ltd., Cuddalore vs. DCIT, Chennai

In the result, the appeals of the Revenue as well as the appeal of the assessee are partly allowed

ITA 2140/CHNY/2013[2010-11]Status: DisposedITAT Chennai28 Apr 2017AY 2010-11

Bench: Shri N.R.S. Ganesan & Shri D.S.Sunder Singh

…ies as submitted by the appellant and the ‘special technical requirement’ demands such facilities as indispensible, it should be treated as “plant” and depreciation at the rate of 15% should be allowed. The case law of CIT v Karnataka Power Corporation (2001) 247 ITR 268 (SC) relied on by the appellant will come to its rescue wherein it is decided that if it serves an assessee’s special technical requirement’, it will qualify to be treated as plant. The case law relied on by the AO in the case of CIT vs. Anand Theatres (2000) (244 ITR 192) wherein the cinema theaters were not considered as “plant” was also discus…

DCIT, Chennai vs. M/S. Neyveli Lignite Corporation Limited, Neyveli

In the result, the appeals of the Revenue as well as the appeal of the assessee are partly allowed

ITA 2077/CHNY/2013[2010-11]Status: DisposedITAT Chennai28 Apr 2017AY 2010-11

Bench: Shri N.R.S. Ganesan & Shri D.S.Sunder Singh

…ies as submitted by the appellant and the ‘special technical requirement’ demands such facilities as indispensible, it should be treated as “plant” and depreciation at the rate of 15% should be allowed. The case law of CIT v Karnataka Power Corporation (2001) 247 ITR 268 (SC) relied on by the appellant will come to its rescue wherein it is decided that if it serves an assessee’s special technical requirement’, it will qualify to be treated as plant. The case law relied on by the AO in the case of CIT vs. Anand Theatres (2000) (244 ITR 192) wherein the cinema theaters were not considered as “plant” was also discus…

DCIT, Chennai vs. M/S. Neyveli Lignite Corporation Limited, Neyveli

In the result, the appeals of the Revenue as well as the appeal of the assessee are partly allowed

ITA 2029/CHNY/2013[2007-08]Status: DisposedITAT Chennai28 Apr 2017AY 2007-08

Bench: Shri N.R.S. Ganesan & Shri D.S.Sunder Singh

…ies as submitted by the appellant and the ‘special technical requirement’ demands such facilities as indispensible, it should be treated as “plant” and depreciation at the rate of 15% should be allowed. The case law of CIT v Karnataka Power Corporation (2001) 247 ITR 268 (SC) relied on by the appellant will come to its rescue wherein it is decided that if it serves an assessee’s special technical requirement’, it will qualify to be treated as plant. The case law relied on by the AO in the case of CIT vs. Anand Theatres (2000) (244 ITR 192) wherein the cinema theaters were not considered as “plant” was also discus…

DCIT, Chennai vs. M/S. Neyveli Lignite Corporation Limited, Neyveli

In the result, the appeals of the Revenue as well as the appeal of the assessee are partly allowed

ITA 1983/CHNY/2011[2008-09]Status: DisposedITAT Chennai28 Apr 2017AY 2008-09

Bench: Shri N.R.S. Ganesan & Shri D.S.Sunder Singh

…ies as submitted by the appellant and the ‘special technical requirement’ demands such facilities as indispensible, it should be treated as “plant” and depreciation at the rate of 15% should be allowed. The case law of CIT v Karnataka Power Corporation (2001) 247 ITR 268 (SC) relied on by the appellant will come to its rescue wherein it is decided that if it serves an assessee’s special technical requirement’, it will qualify to be treated as plant. The case law relied on by the AO in the case of CIT vs. Anand Theatres (2000) (244 ITR 192) wherein the cinema theaters were not considered as “plant” was also discus…

Mr. Sumit Dev, New Delhi vs. ITO, New Delhi

In the result, the appeal filed by the assessee in ITA No

ITA 6197/DEL/2013[2009-10]Status: DisposedITAT Delhi25 Apr 2017AY 2009-10

Bench: Shri R.K. Panda & Smt. Beena A. Pillai[Assessment Year: 2009-10]

For Appellant: Shri R.S. Ahuja, AdvFor Respondent: Smt. Bedobani Chaudhari, Sr. DR
Section 131Section 133(6)

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI “G” BENCH, NEW DELHI BEFORE SHRI R.K. PANDA ACCOUNTANT MEMBER AND SMT. BEENA A. PILLAI, JUDICIAL MEMBER [Assessment Year: 2009-10] Shri Sumit Dev Vs. The I.T.O Prop M/s India Signs Corporation Ward – 22(3) B-21, Friends Colony West New Delhi New Delhi PAN : ADJPD 2589 D (Appellant) (Respondent) [Assessment Year: 2011-12] Shri Sumit Dev Vs. The I.T.O Prop M/s India Signs Corporation Ward – 22(1) B-646, New Friends Colony New Delhi New Delhi PAN : ADJPD 2589 D (Appellant) (Respondent) Assessee by: Shri R.S. Ahuja, Adv Revenue by: Smt. Bedobani Chaudhari, Sr. DR…

ITO, Bangalore vs. M/S Bank Note Paper Mill India (P) Ltd., Bangalore

In the result, cross objections of the assessee are dismissed

ITA 692/BANG/2015[2011-12]Status: DisposedITAT Bangalore17 Mar 2017AY 2011-12

Bench: Smt. Asha Vijayaraghavan & Shri Inturi Rama Raoincome-Tax Officer, Ward 1(1)(3), Bengaluru. … Appellant Vs. Bank Note Paper Mill India Pvt. Ltd. I Floor, Sr Complex, No.2, Tavarakere Main Road, Sg Paly, Drc Post, Bengaluru-560029. … Respondent Pan:Aaecb 3245M & Cross Objn.No.177/Bang/2015 (In Ita No.692/Bang/2015) (Assessment Year: 2011-12) (By The Assessee) ***** Assessee By : Shri S.Parthasarathi, Advocate. Revenue By : Smt.Swapna Das, Jcit(Dr).

For Appellant: Shri S.Parthasarathi, AdvocateFor Respondent: Smt.Swapna Das, JCIT(DR)
Section 143(2)Section 143(3)

…nder CASS, deleted the addition placing reliance on the decisions of the Hon’ble Supreme Court in the case of CIT vs. Bokaro Steel Ltd. (236 ITR 315)(SC) and CIT vs. Karnal Co-operative Sugar Mills Ltd. (243 ITR 2)(SC) and CIT vs. Karnataka Power Corporation (247 ITR 268)(SC). The relevant part of the CIT(A)’s order is extracted below: ITA No.692 & CO 177/Bang/2015 Page 4 of 14 ITA No.692 & CO 177/Bang/2015 Page 5 of 14 ITA No.692 & CO 177/Bang/2015 Page 6 of 14 4. Being aggrieved, the revenue is in appeal in ITA No.692/Bang/2015. The revenue raised the following grounds of appeal: 5. The learned DR vehement…

Il & Fs Tamil Nadu Power Company Limited, Chennai vs. ACIT, Chennai

In the result, the disallowance made by the AO is directed to be withdrawn

ITA 881/CHNY/2015[2010-11]Status: DisposedITAT Chennai14 Feb 2017AY 2010-11

Bench: Shri A. Mohan Alankamony

Section 143(1)

…wn earlier order and accepted the contention of the assessee. The Tribunal, in its order, held as follows: “5. Before me learned counsel for the assessee also relied on the decision of the Supreme Court in the case of CITv. Karnataka Power Corporation [2001] 247 ITR 268, wherein it was held that interest receipts / hire charges received during pre-production is on capital account. Learned counsel for the assessee also relied on various decisions in support of his case. At the time of hearing he had also filed a copy of the order of this Tribunal in I.T.A. No. 1369/Mds/02, dated November 11, 2002, wherein on iden…

DCIT, Chennai vs. M/S. Chettinad Cement Corporation Ltd., Chennai

In the result, the appeals of the Revenue are partly allowed

ITA 2219/CHNY/2016[2012-13]Status: DisposedITAT Chennai30 Nov 2016AY 2012-13

Bench: Shri N.R.S. Ganesan & Shri D.S.Sunder Singhआयकर अपील सं./I.T.A.Nos.2217, 2218 & 2219/Mds/2016 "नधा"रण वष" /Assessment Years:2007-08, 2009-10 & 2012-13

For Appellant: Shri Pathlavath Peerya, CITFor Respondent: Shri S. Sridhar, Advocate
Section 80I

…the cement would be eligible for the depreciation at the rates prescribed to the plant & machinery at 15%”. ITA Nos.2217, 2218 & 2219/Mds/2016 :- 6 -: 9. The Ld.AR also relied on Supreme Court judgement in the case of Karnataka Power Corporation reported in 247 ITR 268.According to the Ld.Counsel, the cement silos are plants and the depreciation is to be allowed @15%. 10. We have considered the submissions made by both the parties and perused the lower authorities’ orders and material on record. As per depreciation schedule, the depreciation is allowed on buildings @5% for which the buildings are mainly used…

Addl CIT 8(2), Mumbai vs. Mumbai International Airport P. Ltd, Mumbai

ITA 3232/MUM/2012[2008-09]Status: DisposedITAT Mumbai30 Nov 2016AY 2008-09

Bench: Shri Mahavir Singh & Shri Ashwani Tanejaassessment Year: 2008-09

Section 143(3)Section 40

…3 ITR 81(SC) and submitted that in the case of an operation theatre in the hospital, it has been held to be a part of plant and not a part of building. Ld. AR referred the decision of the Hon’ble Apex Court in the case of CIT V/s Karnataka Power Corpn. (2000) 247 ITR 268 (SC) and 68 M/s. Mumbai International Airport submitted that the power generating station building is held to be a plant. He submitted that such structures are specific for the purpose of business of the assessee and the assessee is entitled for depreciation at rate as applicable to plant and machinery. 34. On the other hand, ld. DR supported the…

Mumbai International Airport P. Ltd, Mumbai vs. Addl CIT RG 8(2), Mumbai

ITA 2760/MUM/2012[2008-09]Status: DisposedITAT Mumbai30 Nov 2016AY 2008-09

Bench: Shri Mahavir Singh & Shri Ashwani Tanejaassessment Year: 2008-09

Section 143(3)Section 40

…3 ITR 81(SC) and submitted that in the case of an operation theatre in the hospital, it has been held to be a part of plant and not a part of building. Ld. AR referred the decision of the Hon’ble Apex Court in the case of CIT V/s Karnataka Power Corpn. (2000) 247 ITR 268 (SC) and 68 M/s. Mumbai International Airport submitted that the power generating station building is held to be a plant. He submitted that such structures are specific for the purpose of business of the assessee and the assessee is entitled for depreciation at rate as applicable to plant and machinery. 34. On the other hand, ld. DR supported the…

DCIT 7(2), Mumbai vs. Swan Energy Ltd, Mumbai

In the result appeal filed by the Revenue is dismissed

ITA 5442/MUM/2013[2008-09]Status: DisposedITAT Mumbai24 Oct 2016AY 2008-09

Bench: Shri R.C. Sharma() & Shri Amarjeet Singh () Assessment Year: 2008-09

For Appellant: Shri. J.P. BairagraFor Respondent: Shri. H.N. Singh
Section 143(3)

…1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES “E”, MUMBAI BEFORE SHRI R.C. SHARMA(ACCOUNTANT MEMBER) AND SHRI AMARJEET SINGH (JUDICIAL MEMBER) Assessment Year: 2008-09 DCIT 7(2) Vs. Swan Energy Ltd. R.No. 624, M.K. Road (Formerly Swan Mills Ltd.) 6 Feltham House, 2nd Floor Mumbai- 400020 J.N. Herdia Marg, Ballard Estate Mumbai- 400001 PAN No. AABCS7890Q (Appellant) (Respondent) Revenue By : Shri. H.N. Singh Assessee By : Shri. J.P. Bairagra Date of Hearing : 07/09/2016 Date of pronouncement : 24/10/2016 O R D ER PER R.C. SHARMA, ACCOUNTANT MEMBER : This is an appeal filed by the Revenue against the…