80 IA Interplay Ruling

The Court held that:

• SEB tariff (including duty) must be adopted as market value for captive power under Section 80-IA. 

• Deduction under Section 80-IA cannot reduce 80HHC profits where sources are distinct. 

• Sales tax remission subsidy linked to capital investment is capital receipt. 

• Such capital receipt cannot be included in book profits under Section 115JB. 

The appeal was allowed in entirety, strongly reinforcing pro-assessee jurisprudence on deduction interplay and subsidy characterization.