Point of Law:
What has really accrued to the assessee has to be found out and what has accrued must be considered from the point of view of real income taking the probability or improbability of realisation in a realistic manner and dovetailing of these factors together but once the accrual takes place, on the conduct of the parties subsequent to the year of closing an income which has accrued cannot be made “no income.

ORDER :

J. B. Pardiwala, J.

1. This Tax Appeal is filed under Section 260A of the Income Act, 1961 (for short the “Act”) at the instance of revenue and it is directed against the order dated 10.05.2019 passed by the Income Tax Appellate Tribunal, Ahmedabad “C” Bench, Ahmedabad in ITA No.1462/Ahd/2016 for the assessment year 20102011.

2. The revenue has proposed solitary substantial question of law in its Memorandum of Appeal. The question formulated reads thus:

“2(A) Whether the Appellate Tribunal has erred in the facts and circumstances of the case and in law, in upholding the order of the CIT(A) for deleting the addition of Rs.4,42,72,610/- in holding carbon receipts as capital receipts?”

3. We take notice of the fact that the similar issue had arose in the case of very same assessee, so far as the assessment for the year 2009-10 is concerned, we refer to the order passed by this Court in the Tax Appeal No.141 of 2017 dated 02.03.2017. The relevant observations made in the said order reads thus:

“(1.0) Feeling aggrieved and dissatisfied with the impugned judgment and order dated 18.03.2016 passed by the learned Income Tax Appellate Tribunal, Ahmedabad (hereinafter referred to as “Tribunal”) in ITA No.538/Ahd/2013 for AY 200910, by which the learned Tribunal has dismissed the said appeal preferred by the Revenue and confirming the order passed by the learned CIT(A) deleting the addition of Rs.5,78,28,058/-, the Revenue has preferred the present Tax Appeal with the following substantial question of law. “Whether the ITAT is right in law and on facts in deleting the addition of Rs.5,78,28,058/- in holding carbon receipts as capital receipt?” However, considering the impugned judgment and order passed by the learned Tribunal, the correct proposed question of law would be as under:

“Whether the ITAT is right in law and on facts in confirming the order passed by the learned CIT(A) in deleting the addition of Rs.5,78,28,058/- on the ground that the aforesaid income has not accrued / received by the assessee in the year under consideration?”

(2.0) At the outset it is required to be noted that while passing the original assessment order the AO made the addition of Rs.5,78,28,058/- on the ground that the carbon receipt receivable / accrued under the year under consideration is a capital receipt.

(3.0) Feeling aggrieved and dissatisfied with the addition made by the AO of Rs.5,78,28,058/-, the assessee preferred appeal before the learned CIT(A). That by detailed reasoned judgment and order the learned CIT(A) directed to delete the aforesaid addition of Rs.5,78,28,058/- by observing that as there was no transfer / sale of the carbon receipts during the year under consideration and therefore, the same cannot be included in the year consideration. The learned Tribunal in an appeal preferred by the Revenue has confirmed the said order passed by the learned CIT(A) by specifically observing that as the carbon receipts were neither sold / transferred during the year under consideration and therefore, the same cannot be included in the income of the assessee in the year under consideration.

(3.1) Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the learned Tribunal, the Revenue has preferred the present appeal to consider the above recast proposed question of law.

(4.0) We have heard Shri Sudhir Mehta, learned Counsel appearing on behalf of the Revenue and Shri S.N. Soparkar, learned Counsel appearing on behalf of the assessee. We have perused and considered the order passed by the AO as well as the orders passed by the learned AO as well as the orders passed by the learned CIT(A) as well as the impugned judgment and order passed by the learned Tribunal.

(4.1) Considering the order passed by the learned AO it appears that the AO made the addition of Rs.5,78,28,058/- on the ground that the amount of Rs.5,78,28,058/- was receivable and/or can be said to have been accrued in the year under consideration and therefore, the