My Home Power Ltd v DCIT [ITA NO. 1114 (HYD.) OF 2009 dtd 2.11.2012] Hyderabad ITAT Background: Assessee had filed return of income for the assessment year under consideration on 28.2.2008 showing a loss of Rs. 86,54,970. The company is engaged in the business of power generation through biomass power generation unit. During the year under consideration it has received 1,74,037 Carbon Emission Reduction Certificates (CERs) popularly known as ‘carbon credits’ for the project activity of switching off fossil fuel from naphtha and diesel to biomass. It has sold 1,70,556 CERs to a foreign company M/s. Noble Carbon Credits Ltd., Ireland and had received an amount of Rs. 12.87 crores. The assessee had accounted this receipt as capital in nature and had not offered the same for taxation. The AO dealt in detail the taxability of sale proceeds arising out of the sale of CERs and held the same to be a revenue receipt since the CERs are a tradable commodity and even quoted in stock exchange. The CIT(A) confirmed the order of the AO and also gave a finding that the said income of the assessee cannot be considered as income from business for the purpose of entitlement for deduction u/s. 80IA of the Act.