Madhya Pradesh Poorv Kshetra Vidyut Vitran, Jabalpur V. DCIT(TDS),

ITA 191/JAB/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5606 (ITAT-JABALPUR)
• Duration Of Justice: 1 year(s) 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 08-12-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D R LATHORIYA
• Assessee Lawyers: K KUMAR
• Section: 10; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH, JABALPUR BEFORE SHRI N.S. SAINI , HONBLE ACCOUNTANT MEMBER AND SHRI N.K. CHOUDHRY , HONBLE JUDICIAL MEMBER ITA NO S . 191 TO 193 / J AB /201 4 (ASST. YEAR S : 20 1 0 - 1 1 TO 201 2 - 1 3 ) MADHYA PRADESH POORV KSHETRA VIDYUT VITRAN CO. LTD., BLOCK NO.7, SHAKTI BHAWAN, RAMPUR, JABALPUR . VS. DCIT (TDS) , JABALPUR . PAN NO . AADCM 6175 E (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K. KUMAR A R . DEPARTMENT BY : S HRI D.R. LATHORIYA - DR DATE OF HEARING : 0 7 / 0 4 /201 6 . DATE OF PRONOUNCEMENT : 0 7 / 04 /201 6 . O R D E R PER N.S. SAINI , ACCOUNTANT MEMBER THESE ARE THE APPEAL S FILED BY THE ASSESSEE AGAINST THE CONSOLIDATED ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - 1 , JABALPUR , DATED 16 /0 9 /201 4 PASSED IN ASSESSMENT YEARS 2010 - 11, 2011 - 12 & 2012 - 13 . 2. IN GROUND NOS. 1 & 2 OF THE APPEAL, THE GRIEVANCE OF THE ASSESSEE IS THAT THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE LEVY OF INTEREST UNDER SEC. 201(1A) OF THE ACT OF RS. 2,40,97,355/ - IN FINANCIAL YEAR 2009 - 10, RS. 4,37,86,871/ - IN FINANCIAL YEAR 2010 - 11 AND RS. 4,19,42,632/ - IN FINANCIAL YEAR 2011 - 12. 3 . BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS PURCHASING POWER FROM GENERATION COMPANY AND SELLING IT TO THE CONSUMERS. TRANSMISSION 2 ITA NO. 191 - 193 / JAB /201 4 NETWORK OF THE SELLING COMPANY IS UTILIZED FOR THIS PURPOSE . DU RING THE YEAR S UNDER CONSIDERATION, THE ASSESSEE HAS PAID WHEELING CHARGES TO MADHYA PRADESH POWER TRANSMISSION COMPANY LTD. (MPPTCL) . ACCORDING TO THE ASSESSING OFFICER, THE PAYMENT MADE IS IN THE NATURE OF TECHNICAL SERVICES RENDERED BY THE TRANSMISSION COMPANY AND THEREFORE, THE ASSESSEE IS REQUIRED TO DEDUCT TAX AT SOURCE FROM THE PAYMENTS MADE TO MPPTCL UNDER SEC. 194J FROM THE F OLLOWING PAYMENTS : - S.NO. FINANCIAL YEAR PAYMENT (RS.) 1 2009 - 10 1,99,64,41,919 2 2010 - 11 3,79,04,99,304 3 2011 - 12 3,73,77,14,713 THEREFORE, HE HELD THAT THE ASSESSEE IS LIABLE TO PAYMENT OF INTEREST UNDER SEC. 201(1 A ) OF THE ACT AS UNDER : - F.Y. 2009 - 10 2,40,97,355/ - F.Y. 2010 - 11 4,37,86,871/ - F.Y. 2011 - 12 4,19,42,632/ - 4 . ON APPEAL, COMMISSIONER OF INCOME TAX (APPEALS) CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 5. BOTH THE PARTIES BEFORE US AGREED THAT THE ISSUE IS COVERED IN THE CASE OF CIT VS. HUBLI ELECTRIC SUPPLY COMPANY LTD . (2016) 65 TAXMANN.COM 208 (KAR.) , WHEREIN IT WAS HELD THAT WHERE THE ASSESSEE HAS DONE ONLY TRANSMISSION OF POWER FROM ONE PLACE TO OTHER FOR A PRICE, THERE WAS NEITHER TRANSFER OF ANY TECHNOLOGY NOR ANY SERVICE ATTR IBUTABLE TO A TECHNICAL SERVICE, AND THEREFORE, SEC. 194J WAS NOT APPLICABLE. TO THE SAME EFFECT , IS THE DECISION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. DELHI TR ANSCO. LTD. (2016) 380 ITR 398 (DEL.) , WHEREIN IT WAS HELD THAT ALTHOUGH , THE WHEELING CHARGES MAY BE FIXED BY THE COMMISSION, THAT BY ITSELF WAS NOT A DETERMINATIVE FACTOR. ONCE IT WAS ACCEPTED THAT ALL THAT WAS DONE TO TRANSMIT THE ELECTRICITY TO THE AS SESSEE THROUGH THE NETWORK WITHOUT ANY HUMAN INTERVENTION, IT 3 ITA NO. 191 - 193 / JAB /201 4 COULD NOT BE CHARACTERIZED AS A PROVISION OF TECHNICAL SERVICES AND SOUGHT TO BE BROUGHT WITHIN THE FOLD OF SEC. 194J. 6 . IN VIEW OF THE ABOVE SUBMISSIONS MADE BY BOTH THE PARTIES , AS THE ASSESSEE WILL NOT BE LIABLE TO DEDUCT TDS FROM PAYMENT MADE TO MPPTCL UNDER SEC. 194J OF THE ACT, CONSEQUENTLY THERE WILL BE NO LIABILITY ON THE ASSESSEE FOR PAYMENT OF INTEREST UNDER SEC. 201(1A) OF THE ACT. HENCE, WE DELETE THE LEVY OF INTEREST UNDER SEC. 201(1A ) OF RS.2,40,97,355/ - IN FINANCIAL YEAR 2009 - 10, RS. 4,37,86,871/ - IN FINANCIAL YEAR 2010 - 11 AND RS. 4,19,42,632/ - IN FINANCIAL YEAR 2011 - 12 . 7. GROUND NO.3 OF THE ASSESSEE , IN THIS APPEAL , READS AS UNDER: - THAT THE CIT(A) TRAVELLED BEYOND HIS POWERS BY RELYING UPON THE ORDER DATED 27/08/2012 PASSED BY AAR NEW DELHI WHICH HAS ITS LIMITED APPLICABILITY AS PER SEC. 245S OF THE IT ACT. MOREOVER SO IN WRIT PETITION NO. 20195/2012 , VIDE ORDER DATED 14/03/2013 HON'BLE HIGH COURT OF RAJASTHAN HAS STAYED FUTURE OPERATION OF THIS RULING RELIED UPON BY THE CIT(A). 8. AT THE TIME OF HEARING, NO SUBMISSIONS WERE MADE BY THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE HENCE, THE SAME IS DISMISSED FOR WANT OF PROSECUTION. 9. IN THE RESULT, ALL THE THREE APPEAL S OF THE ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING ON THURSDAY , THE 0 7 TH DAY OF APRIL , 201 6 AT JABALPUR . S D/ - SD/ - ( N.K. CHOUDHRY ) (N.S.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER D ATED : 0 7 TH APRIL , 201 6 . 4 ITA NO. 191 - 193 / JAB /201 4 VR/ - COPY TO: 1. THE ASSESS E E. 2. THE REVENUE. 3. THE CIT 4. THE CIT(A) 5. THE D.R . 6. GUARD FILE. BY ORDER SR. PRIVATE SECRETARY, ITAT, JABALPUR.