Budget Impact on Power Sector
Union Budget 2009-10 extended the sunset clause for tax holiday under section 80-IA of the Income Tax act available for power generating unit as well as transmission and distribution companies up to March 31, 2011.

Moreover, the budget has also reduced the excise duty on naphtha to 14%.  It has also increased the allocation under central power sector schemes such as APDRP, rural electrification, etc.

Though the tax benefit under section 80IA was extended beyond the terminal year, the other core expectations of the industry such as exemption of interest payable by Indian power/ infra companies U/s 10 (15) or withholding liability; refinancing of existing rupee loans through ECB, etc were ignored.

Yet, overall, the Union Budget 2009-10 is a positive for the power sector.

Budget Impact on Power Industry                

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