Noida Power Company Ltd., Greater Noida V. ACIT, Noida

ITA 4878/DEL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3034 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Assessment Year: 2012-2013
• Appeal Filed On: 12-09-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S R SENAPATI
• Assessee Lawyers: SUSHMITA BASU
• Keywords: Depreciation; Cost of acquisition; Non-deduction of tax
• Section: 143(3); 142(1); 234B; 115JB; 201(1)

Judgement Text

1 ITA NO. 4878/DEL/2016 IN THE INCOME TAX APPELLA TE TRIBUNAL DELHI BENCH: E NEW DELHI BEFORE SHRI N. K. SAINI, ACCOUNTANT MEMBER AND MS SUCHITRA KAMBLE, JUDI CIAL MEMBER ITA NO. 4878/DEL/201 6 ( A.Y 2012-13) NOIDA POWER COMPANY LTD. COMMERCIAL COMPLEX, H-BLOCK, ALPHA-II, SECTOR GREATER NOIDA AAACN4984D (APPELLANT) VS ACIT CIRCLE-2 NOIDA (RESPONDENT) APPELLANT BY MS. SUSHMITA BASU RESPONDENT BY SH. SR. SENAPATI, SR DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER DATED 30/06/2016 PASSED BY CIT(A)-1, NOIDA. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE ORDER DATED 30 TH JUNE, 2016 PASSED BY THE LEARNED CIT (APPEALS) UPH OLDING THE ORDER DATED 30 TH MARCH, 2015 PASSED U/S 143(3) OF THE ACT BY THE AC IT IS BAD IN LAW. 2. THAT THE LEARNED CIT (APPEALS) ERRED IN NOT PASS ING A SPEAKING ORDER FOR THE YEAR UNDER CONSIDERATION AND ACCORDINGLY ORDER OF LEARNED CIT(APPEALS) IS INVALID, ILLEGAL, BAD IN LAW AND LIABLE TO BE QU ASHED. DATE OF HEARING 06.02.2018 DATE OF PRONOUNCEMENT 19.03.2018 2 ITA NO. 4878/DEL/2016 3. THAT THE LEARNED CIT (APPEALS) ERRED IN NOT ADJ UDICATING ALL THE GROUNDS RAISED BY THE APPELLANT IN THE GROUNDS OF APPEAL F ILED BEFORE HIM . 4(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER, IN DISALLOWING THE APPELLANT'S CLAIM FOP DEDUCTION OF AN AGGREGATE SUM OF RS. 15,77,68,266/-, BEING THE DIFFERENCE BETWEEN THE! P URCHASE PRICE OF ELECTRICITY BILLED BY UPPCL AMOUNTING TO RS. 1,10,0 8,54,335/- AND THE PURCHASE PRICE OF ELECTRICITY DEBITED TO THE P & L A/C BY THE APPELLANT AMOUNTING TO RS. 94,30,86,069/- AT THE RATES DETERM INED ON THE BASIS OF METHODOLOGY FOLLOWED BY THE UPERC. 4(B) THAT THE LEARNED CIT (APPEALS) ERRED IN CONFIR MING THE ACTION OF THE ASSESSING OFFICER IN HOLDING THE AFORESAID LIAB ILITY OF THE APPELLANT AS CONTINGENT IN NATURE. 5(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND WITHOUT PREJUDICE TO THE ADMISSIBILITY OF THE IMPUGNED DEDU CTION IN THE AY 2013- 14, THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING T HE ACTION OF THE ASSESSING OFFICER IN NOT ALLOWING DEDUCTION OF RS. 51,06,07,633/- REPRESENTING FURTHER AMOUNT PAYABLE BY THE APPELLAN T TO UPPCL AS PER ORDER OF UPERC ON ACCOUNT OF POWER PURCHASE PRICE I N RESPECT OF THE POWER SUPPLIED BY THE APPELLANT FOR THE YEAR UNDER CONSID ERATION. 5(B) THAT THE LEARNED CIT (APPEALS) ERRED IN CONFIR MING THE ACTION OF THE ASSESSING OFFICER IN HOLDING THE AFORESAID LIABILIT Y OF THE APPELLANT AS CONTINGENT IN NATURE. 6(A) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (APPEALS) ERRED IN HOLDING THAT THE APPELLANT I S LIABLE TO DEDUCT TAX AT SOURCE UNDER SECTION 194J OF THE ACT ON THE TRANSMI SSION/WHEELING CHARGES PURPORTEDLY AMOUNTING TO RS. 24,70,24,128/- AND ACCORDINGLY DISALLOWANCE WAS WARRANTED U/S 4O(A)(IA) OF THE ACT . 6(B) THAT THE LEARNED CIT (APPEALS) ERRED IN CONFIR MING THE ACTION OF THE ASSESSING OFFICER IN DISALLOWING THE TRANSMISSION/W HEELING CHARGES U/S. 40A(IA) OF THE ACT WITHOUT APPRECIATING THE FACT TH AT THE APPELLANT HAS NOT BEEN HELD AS ASSESSE IN DEFAULT U/S. 201(1)/ 20I(IA ) OF THE ACT FOR THE YEAR UNDER CONSIDERATION. 6(C) THAT THE LEARNED CIT (APPEALS) FAILED TO APPRE CIATE THAT THE ORDER 3 ITA NO. 4878/DEL/2016 RELIED UPON BY THE ASSESSING OFFICER WHILE INFLICTI NG THE IMPUGNED DISALLOWANCE HAS BEEN REVERSED BY THE LEARNED PREDE CESSOR CIT (APPEALS) IN THE APPEAL AGAINST THE ORDER PASSED U/S. SECTION 201(1)/ 20I(IA) OF THE ACT. 6(D) WITHOUT PREJUDICE TO THE ABOVE, THE CIT (APPEA LS) FAILED TO APPRECIATE THAT OUT OF THE SAID AMOUNT OF RS. 24,70,24,128/-, THE SUM OF RS. 7,15,000/- AND RS. 1,09,34,000/- RESPECTIVELY ARE P AID ON ACCOUNT OF APPLICATION FEES AND OPERATING CHARGES WHICH IN ANY EVENT, CANNOT BE COVERED WITHIN THE PURVIEW OF SECTION 194J OF THE A CT. 6(E) WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED CI T (APPEALS) FAILED TO APPRECIATE THAT OUT OF THE SAID AMOUNT OF RS. 24,70 ,24,128/- THE APPELLANT, IN ANY EVENT, IS NOT LIABLE TO DEDUCT TAX ON AN AGG REGATE AMOUNT OF RS. 84,41,963/- WHICH REPRESENTS REIMBURSEMENT OF EXPEN SES. 7. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (APPEALS) ERRED IN UPHOLDING THE ACTION OF THE ASSE SSING OFFICER IN NOT ALLOWING SET-OFF OF BROUGHT FORWARD BUSINESS LOSS A ND DEPRECIATION ALLOWANCE WHILE CALCULATING THE TOTAL INCOME TAXABL E UNDER THE PROVISIONS OF THE ACT OTHER THAN SECTION 115JB THEREOF IN THE IMPUGNED ORDER UNDER APPEAL. 8. WITHOUT PREJUDICE TO THE GROUNDS TAKEN ABOVE, TH AT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A PPEALS) ERRED IN CONFIRMING THE ACTION OF ASSESSING OFFICER IN NOT A LLOWING TAX CREDIT UNDER THE PROVISIONS OF SECTION 115JAA OF THE ACT. 9. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE ACTION OF ASS ESSING OFFICER IN CHARGING INTEREST U/S. 234B OF THE ACT AT RS. 8,38, 22,076/-. 10. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND, MODIFY, RESCIND, SUPPLEMENT OR ALTER ANY OF THE GROUNDS STATED HEREI NABOVE EITHER BEFORE OR AT THE TIME OF HEARING OF THIS APPEAL. 3. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINES S OF DISTRIBUTION OF POWER IN THE GREATER NOIDA AREA. ON 31.03.2012, THE ASSESSEE FILED ITS RETURN OF INCOME. SUBSEQUENTLY, THE ASSESSEE FILED REVISED RE TURN OF INCOME DECLARING 4 ITA NO. 4878/DEL/2016 TAXABLE INCOME OF RS. NIL ON 29.03.2014. THE CASE W AS SELECTED FOR SCRUTINY AND NOTICE U/S 143(2) OF THE INCOME TAX ACT, 1961 W AS ISSUED ON 05.09.2014 BY THEN DCIT, CIRCLE-3, NOIDA AND SERVED UPON THE A SSESSEE. SUBSEQUENTLY, NOTICES U/S 143(2) AND 142(1) ALONG WITH DETAILS QU ESTIONNAIRE WERE ALSO ISSUED TO THE ASSESSEE. IN RESPONSE TO THE NOTICES THE AUT HORISED REPRESENTATIVES OF THE ASSESSEE APPEARED BEFORE THE ASSESSING OFFICER AND FURNISHED THE DETAILS AND REPLIES DURING THE ASSESSMENT PROCEEDINGS. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT ON 30.03.2015 AND MADE ADD ITION OF RS. 66,83,75,898/- TOWARDS POWER PURCHASE PRICE NOT DEB ITED TO PROFIT AND LOSS ACCOUNT BY THE ASSESSEE. THE ASSESSING OFFICER FURT HER MADE ADDITION OF RS.24,70,24,128/- BY DISALLOWING NON DEDUCTION OF T DS ON TRANSMISSION CHARGES. 4. BEING AGGRIEVED BY THE ASSESSMENT ORDER THE ASSE SSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) BY FOLLOWING EARLIER YEARS O RDER DISMISSED THE APPEAL OF THE ASSESSEE. 4. THE LD. AR SUBMITTED THAT GROUND NOS. 1 TO 3 ARE NOT PRESSED AS THE SAME ARE CONSEQUENTIAL TO GROUND NOS. 4(A) TO 5(B) AND GROUND NOS. 4(A) TO 5(B) ARE ALSO NOT PRESSED AS THESE GROUNDS HAVE BECOME A CADEMIC AND INFRUCTUOUS FOR THE FOLLOWING REASONS: A) THE ASSESSEE COMPANY ENTERED INTO AN AGREEMENT W ITH UTTAR PRADESH STATE ELECTRICITY BOARD [NOW KNOWN AS UTTAR PRADESH POWER CORPORATION LIMIT ED (UPPCL)] TO PURCHASE POWER. UPPCL RAISED INVOICES ON THE AS SESSEE FOR SUPPLY OF POWER AT MARGINAL COST BEING A HIGHER RATE. THE ASSESSEE DISPUTED THE RATE BEFORE THE APPROPRIATE FORUM. FOR INCOME TAX PURPOS E, FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING, THE ASSESSEE CLAIMED POWER PU RCHASE COST AT THE RATES BILLED BY UPPCL. HOWEVER, IN ITS BOOKS OF ACCOUNTS THE ASSESSEE DEBITED THE POWER PURCHASE COST AT THE RATE PROVISIONALLY DETER MINED BY UTTAR PRADESH ELECTRICITY REGULATORY COMMISSION (UPERC) WHICH W AS LOWER THAN THE INVOICE AMOUNT. 5 ITA NO. 4878/DEL/2016 B) THE ASSESSING OFFICER ALLOWED THE POWER PURCHASE COST AT THE RATES AT WHICH POWER PURCHASE WAS DEBITED IN THE PROFIT AND LOSS ACCOUNT AND NOT THE INVOICED AMOUNT AS CLAIMED BY THE ASSESSEE. THE ASS ESSEE CONTESTED THE ACTION OF THE ASSESSING OFFICER AND HENCE THESE GROUNDS OF APPEAL. C) AS STATED ABOVE, THE ASSESSEE DISPUTED THE RATES AT WHICH UPPCL RAISED THE INVOICES AND THE MATTER TRAVELLED BEFORE THE UP ERC FOR DETERMINATION OF THE FINAL RATE. D) UPERC DECIDED THE RATE ISSUE IN FAVOUR OF THE AS SESSEE AND UPPCL DID NOT FILE ANY APPEAL AGAINST THE SAME, THE ISSUE HAD ATTAINED FINALITY. THEREFORE, THE PRESENT GROUNDS 4(A) TO 5(H) CLAIMING BILLED AMOUNT HAS BECOME ACADEMIC AND INFRUCTUOUS FOR THE YEAR. E) THE LD. AR SUBMITTED THAT RECENTLY, THE APPEAL OF U PPCL IN THE EARLIER YEARS ON THE RATE ISSUE HAS TRAVELLED TO HONBLE SU PREME COURT AND THE HONBLE APEX COURT DISMISSED THE APPEAL ON THE GROUNDS OF N ON-PROSECUTION. 5. AS REGARDS TO GROUND NOS. 6(A) TO 6(E) OF DISALLOWANCE UNDER SECTION 40(A)(IA) FOR NON-DEDUCTION OF TAX ON PAYMENT OF TRANSMISSION CHARGES, THE LD. AR SUBMITS THAT THE ISSUE IS COVERED SQUARELY IN FAVOUR OF THE ASSE SSEE BY THE DECISION OF THE TRIBUNAL IN THE ASSESSEES OWN CAS E FOR THE ASSESSMENT YEARS 2011-12 AND 2012-13 WHEREIN THE TRIBUNAL HAS HELD THAT NO TAX IS REQUIRED TO BE WITHHELD FROM PAYMENT OF TRANSMISSION CHARGES. THUS, THE LD. AR FURTHER SUBMITS THAT THE TRIBUNAL RIGHTLY HELD THAT TAX IS NOT REQUIRED TO BE WITHHELD FROM TRANSMISSION CHARGES AND ACCORDINGLY THE DISAL LOWANCE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF NON-DEDUCTION OF TA X FROM SUCH PAYMENTS IS BAD IN LAW AND IS LIABLE TO DELETED. 6. FURTHER, WHILE DISALLOWING THE SAID EXPENSES THE AS SESSING OFFICER RELIED ON AN ORDER DATED 27 TH MARCH, 2014 PASSED BY DCIT (TDS) UNDER SECTION 201(I)/(IA) READ WITH SECTION 194J OF THE ACT FOR T HE YEAR UNDER CONSIDERATION. IN THIS CONNECTION THE LD. AR SUBMITTED THAT AN APP EAL WAS FILED BY THE 6 ITA NO. 4878/DEL/2016 ASSESSEE BEFORE THE CIT(A) AGAINST THE SAID ORDER DATED 27 TH MARCH, 2014 OF THE DCIT (TDS). THE CIT(A) VIDE ITS ORDER DATED 25 TH MAY, 2015 [APPEAL NO. 145 & 350/2014-15, NOIDA] DECIDED THE APPEAL IN FAVOUR OF THE ASSESSEE. AS ALREADY STATED ABOVE, THE TRIBUNAL ALSO UPHELD THE ORDER PA SSED BY THE CIT (A). THUS, THE ORDER ON WHICH THE ASSESSING OFFICER RELIED ON FOR INFLICTING THE SAID DISALLOWANCE IS NO MORE IN EXISTENCE AND THE DISALLOWANCE MADE BY THE ASSESSING OFFICER CANNOT SUSTAIN AND IS LIABLE TO B E DELETED. THUS, THE LD. AR PRAYED TO DELETE THE DISALLOWANCE MADE BY THE ASSES SING OFFICER ON ACCOUNT OF NON-DEDUCTION OF TAX AT SOURCE FROM TRANSMISSION CH ARGES. 7. AS RELATES TO SUBMISSION ON MERIT, THE LD. AR SUBMI TTED THAT THE I SSUE COVERED IN FAVOUR OF THE ASSESSEE . THE LD. AR SUBMITTED THAT THE TRIBUNAL HAS DECIDED THE SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE VIDE ITS ORDER DATED 16 TH NOVEMBER, 2017 [ITA NO. 5443/DEL/2015] AND 29 TH NOVEMBER, 2017 [ITA NO. 5442/DEL/2015] FOR THE ASSESSMENT YEAR 2012-13 AND FOR THE ASSESSMENT YEAR 2011-12 RESPECTIVELY. FURTHER THE ISSUE IS COV ERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS DELHI TRANSCO LTD [62 TAXMANN.COM 166 (DELHI)] ( 2015). IN THAT CASE, DELHI TRANSCO LTD. (DTL) WAS PAYING TRANSMISSION CHARGE S TO PGCIL FOR TRANSMITTING POWER THROUGH PGCIL LINES AS PER GUIDE LINES OF CERC. IN THE PRESENT CASE ALSO, AS ALREADY STATED ABOVE, THE POW ER IS DRAWN BY THE ASSESSEE USING THE TRANSMISSION LINES OF PGCIL AND TRANSMISSION CHARGES WAS PAID TO THEM. AS TRANSMISSION OF ELECTRICITY WAS AUTOMATIC THROUGH THE NETWORK OR EQUIPMENT FOLLOWING THE PRINCIPLE LAID DOWN IN THE CASE OF DELHI TRANSCO (SUPRA), TRANSMISSION OR WHEELING CHARGES DOES NOT COME UND ER THE PURVIEW OF THE DEFINITION OF FEES FOR PROFESSIONAL SERVICES OR FEES FOR TECHNICAL SERVICES AS DEFINED UNDER SECTION 194J OF THE ACT AND ACCORDING LY, NO TAX IS REQUIRED TO BE DEDUCTED AT SOURCE FROM SUCH PAYMENTS/ REIMBURSEMEN TS MADE TOWARDS TRANSMISSION OR WHEELING CHARGES. THE LD. AR FURTHER SUBMITTED THAT REVENUES SPECIAL LEAVE PETITION AGAINST THE ORDER OF DELHI TRANSCO (SUPRA) HAS BEEN DISMISSED BY THE HONBLE SUPREME COURT . IN RENDERING THE ABOVE DECISION, THE 7 ITA NO. 4878/DEL/2016 HONBLE DELHI COURT REFERRED TO A JUDGMENT OF THE H ONBLE BOMBAY HIGH COURT IN THE CASE OF CIT (TDS) VS. MAHARASHTRA ELECTRICIT Y DISTRIBUTION CO. LTD. [2015] 375ITR 23 WHEREIN IT WAS HELD THAT WHEELING CHARGES WOULD NOT AMOUNT TO PAYMENT OF FEES FOR TECHNICAL SERVICES AND ACCOR DINGLY NO TAX IS REQUIRED TO BE WITHHELD FROM SUCH PAYMENTS. THE HONBLE APEX CO URT IN THIS EASE ALSO DISMISSED THE REVENUES SPECIAL LEAVE PETITION AGAI NST THE ORDER OF THE BOMBAY HIGH COURT. FURTHER, THE ISSUE IS ALSO COVER ED DIRECTLY IN FAVOUR OF THE ASSESSEE BY THE FOLLOWING DECISIONS RENDERED BY THE HONBLE JURISDICTIONAL TRIBUNAL, DELHI BENCH AND VARIOUS OTHER HONBLE TRI BUNAL AND HONBLE HIGH COURT OF THE COUNTRY': ACIT VS. MADHYANCHAL VIDYUT VITRAN NIGAM LTD. [ITA NO. 01/LKW/2013 AND 505/LKW/2012 DATED 27 TH FEBRUARY, 2015] (LUCKNOW) JAIPUR VIDYUT VITRAN NIGAM LTD. VS. DCIT [123 TTJ 8 88 (JP.)] CHATTISGARH ELECTRICITY BOARD VS. ITO [143 TTJ 151 (CHH.)] BANGALORE ELECTRICITY SUPPLY CO. LTD. VS. ITO [149 TTJ 103 (BANG.)] GRIDCO LTD. VS. ACIT [49 SOT 363 (CUT)] M/S AURO MIRA BIOPOWER INDIA PVT LTD VS, ITO (TDS) [ITA NO. 2584 TO 259O/MDS/20I4 CHENNAI] (CHENNAI) ITO (TDS) VS. HINDUSTAN ZINC LTD [IT APPEAL NOS. 48 8 TO 491 (JODH.) OF 2010] (JODHPUR) CIT VS HUBLI ELECTRIC SUPPLY CO. LTD. [65 TAXMANN.C OM 208 (KARNATAKA)] CIT VS GULBARGA ELECTRICITY SUPPLY CO. LTD [(2016) 386 ITR 622 (KARNATAKA)] THE LD. AR POINTED OUT THAT THE VARIOUS TRIBUNALS A ND HIGH COURTS ACROSS THE COUNTRY HAVE CONSISTENTLY HELD THAT TRANSMISSION OR WHEELING CHARGES PAID IN RESPECT OF TRANSMISSION OF POWER DOES NOT COME WITH IN THE AMBIT OF THE AFORESAID DEFINITION OF FEES FOR TECHNICAL SERVICE S. HENCE, NO TAX IS REQUIRED TO BE DEDUCTED AT SOURCE FROM SUCH TRANSMISSION OR WHE ELING CHARGES. 8. THE LD. AR FURTHER SUBMITTED THAT AS PER EXPLANATIO N (B) TO SECTION 194J 8 ITA NO. 4878/DEL/2016 OF THE ACT, FEES FOR TECHNICAL SERVICES HAS SAME MEANING AS PROVIDED IN EXPLANATION 2 TO CLAUSE (VII) OF SUB SECTION (1) OF SECTION 9. THE LD. AR SUBMITTED THAT THE EXPRESSION FEES FOR TECHNICAL SERVICES HAS BEEN DEFINED UNDER EXPLANATION 2 TO CLAUSE (VII) OF SUB-SECTION (1) OF SECTION 9 OF THE ACT AS UNDER- EXPLANATION 2: FOR THE PURPOSE OF THIS CLAUSE, FE ES FOR TECHNICAL SERVICES MEANS ANY CONSIDERATION (INCLUDING AY LUMPSUM CONSI DERATION) FOR THE RENDERING OF ANY MANAGERIAL, TECHNICAL OR CONSULTAN CY SERVICES (INCLUDING THE PROVISION OF SERVICES OF TECHNICAL OR OTHER PERSONN EL) BUT DOES NOT INCLUDE CONSIDERATION FOR ANY CONSTRUCTION ASSEMBLY, MINING OR LIKE PROJECT UNDERTAKEN BY THE RECIPIENT OR CONSIDERATION WHICH COULD BE INCOME OF THE RECIPIENT CHARGEABLE UNDER THE HEAD SALARIES. THE LD. AR SUBMITTED THAT FROM ABOVE DEFINITION IT CAN BE SEEN THAT A SERVICE WILL BE QUALIFIED AS FEES FOR TECHNICAL SERVICE IF SUCH PAYMENT IS MADE FOR MANAGERIAL, TECHNICAL AND CONSULTANCY SERVICES. THE WORD TECHNICAL IS PRECEDED BY THE WORD MANAGERIAL AND SUCCEEDED BY THE WORD CONSULTANCY. SINCE THE EXPRESSION TECHNICAL SERVICES IS IN DOU BT AND IS UNCLEAR, THE RULE OF NOSCITUR A SOCIIS IS CLEARLY APPLICABLE. WHERE TWO OR MORE WORDS WHI CH ARE SUSCEPTIBLE OF ANALOGOUS MEANING ARE COUPLED TOGETH ER, NOSCITUR A SOCIIS, THEY ARE UNDERSTOOD TO BE USED IN THEIR COGNATE SENSE. T HEY TAKE, AS IT WERE, THEIR COLOUR FROM EACH OTHER, THE MEANING OF THE MORE GEN ERAL BEING RESTRICTED TO A SENSE ANALOGOUS TO THAT OF THE LESS GENERAL. SINCE BOTH THE MANAGERIAL AND CONSULTANCY SERVICES INVOLVE HUMAN INTERVENTION, IT IMPLIES THAT IN ORDER TO QUALIFY AS TECHNICAL SERVICE THERE HAS TO BE SOME H UMAN INTERVENTION. ACCORDINGLY, WITHOUT HUMAN INTERVENTION, THERE CANN OT BE ANY TECHNICAL SERVICE. THE SAID PRINCIPLE HAS BEEN LAID OUT IN PL ETHORA OF CASES INCLUDING HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. BHARATI CELLULAR LIMITED [17 5 TAXMAN 573 (DEL)] WHICH HAS BEEN AFFIRMED BY THE HONBLE SUPREME COUR T IN [193 TAXMAN 97 (SC)]. 9 ITA NO. 4878/DEL/2016 9. THE LD. AR FURTHER SUBMITTED THAT FOR THE PURPOSE O F ASCERTAINING WHETHER OR NOT THE ACTIVITY OF TRANSMISSION AND WHE ELING COULD BE SAID TO BE COVERED WITHIN THE DEFINITION OF THE TERM FEES FOR TECHNICAL SERVICES IN THE CONTEXT OF THE PRESENT APPEAL, THE ONLY QUESTION WH ICH IS REQUIRED TO BE ANSWERED IS WHETHER PROCESS OF TRANSMISSION AND WHE ELING INVOLVES HUMAN INTERVENTION OR NOT. THE LD. AR FURTHER SUBMITTED T HAT UPPTCL/NRLDC ADMITTEDLY REQUIRES USAGE OF VARIOUS HIGHLY TECHNIC AL AND SOPHISTICATED EQUIPMENT HOWEVER, THE FACT THAT UPPTCL/ NRLDC HAS INSTALLED SUCH SOPHISTICATED AND TECHNICAL EQUIPMENT IN EXCHANGE T O ENSURE TRANSMISSION OF ELECTRICITY TO THE DRAWEE ENTITY, DOES NOT ON THAT SCORE, MAKE IT PROVISION OF A TECHNICAL SERVICE TO THE CUSTOMER. INSTALLATION AND OPERATION OF SOPHISTICATED EQUIPMENT WITH A VIEW TO EARN INCOME BY ALLOWING CU STOMERS TO AVAIL THE BENEFIT OF SUCH EQUIPMENT DOES NOT RESULT IN THE PR OVISION OF TECHNICAL SERVICE TO THE CUSTOMER FOR A FEE. THE TERM 'TECHNICAL SERV ICE' AS REFERRED TO IN SECTION 9(I)(VII) OF THE ACT CONTEMPLATES RENDERING OF A 'S ERVICE' TO THE PAYER OF THE FEE I.E. AS STATED ABOVE HUMAN INTERVENTION IS A MANDAT ORY CONDITION. MERE COLLECTION OF A 'FEE' FOR DRAWING POWER FROM A STAN DARD FACILITY PROVIDED TO ALL THOSE WILLING TO PAY FOR IT DOES NOT AMOUNT TO THE FEE HAVING BEEN RECEIVED FOR RENDERING ANY TECHNICAL SERVICES. SINCE NEITHER NRL DC NOR PGCIL NOR UPPTCL PROVIDED ANY TECHNICAL SERVICE TO THE ASSESSEE WITH IN THE MEANING OF EXPLANATION 2 TO SECTION 9(I)(VII) OF THE ACT BUT H AS MERELY CHARGED FOR DRAWING POWER FROM THE TRANSMISSION FACILITY AND THUS, THER E CANNOT BE ANY QUESTION OF DEDUCTION OF TAX AT SOURCE UNDER THE PROVISIONS OF SECTION 194J OF THE ACT. 10. THE LD. AR FURTHER SUBMITTED THAT WHERE A PERSON HA S DEVELOPED A TECHNICAL SYSTEM CONSISTING OF SOPHISTICATED INSTRU MENTS AND THE TECHNICAL ABILITY AND KNOWLEDGE TO OPERATE AND MAINTAIN THE S YSTEM, IT DOES NOT RESULT IN PROVIDING ANY TECHNICAL SERVICE TO OTHERS. IT IS SU BMITTED THAT THE TECHNICAL SYSTEM CONSISTING OF SOPHISTICATED INSTRUMENTS FOR TRANSMISSION OF POWER HAS BEEN DEVELOPED BY PGCIL FOR ITS OWN PURPOSE AND NOT FOR ANY SPECIFIC BENEFIT OF THE ASSESSEE. IT IS A CASE OF OPERATING AND MAINTAI NING ITS OWN SYSTEM BY USING 10 ITA NO. 4878/DEL/2016 THE SERVICES OF ENGINEERS AND QUALIFIED TECHNICIANS AND NOT A CASE OF PROVIDING THE TECHNICAL SERVICES TO OTHERS BY THOSE ENGINEERS AND QUALIFIED TECHNICIANS. THE MAINTAINING OF THE DELIVERY VOLTAGE, ECONOMIC T RANSMISSION, MINIMUM LOSS OF ELECTRICITY IN TRANSMISSION, REGULAR AND UNINTER RUPTED SUPPLY ETC. ARE THE STATUTORY FUNCTIONS FOR MAINTAINING THE TRANSMISSIO N SYSTEM BY NRLDC THEMSELVES. BY DISCHARGING THOSE FUNCTIONS NRLDC AR E NOT PROVIDING ANY TECHNICAL SERVICE TO THE ASSESSEE. IN FACT FROM THE GENERATION POINT TO THE DISTRIBUTION POINT OF THE ASSESSEE, ELECTRICITY IS TRANSMITTED AUTOMATICALLY AND NONE OF THE ENGINEERS/TECHNICIANS OF NRLDC/ PGCIL P ROVIDE ANY SERVICE TO THE DISTRIBUTION COMPANIES OR GUIDE THEM AS TO HOW TO C APTURE THE ELECTRICITY SO TRANSMITTED. THE ASSESSEE ITSELF HAS A FLEET OF ENG INEERS AND TECHNICIANS WHO CONSTANTLY MONITOR AND SUPERVISE THE FLOW OF ELECTR ICITY TO ITS SYSTEM AND ULTIMATE SUPPLY TO ITS CUSTOMERS. 11. THE LD. AR FURTHER SUBMITTED THAT NRLDC IS A SY STEM OPERATOR AND CONTROLLER FOR OPTIMUM SCHEDULING AND DISPATCH OF E LECTRICITY, SUPERVISION OVER THE INTER-STATE TRANSMISSION SYSTEM AND RESPONSIBLE FOR CARRYING OUT REAL TIME OPERATIONS FOR GRID CONTROL AND DISPATCH OF ELECTRI CITY 7 WITHIN THE REGION. ALL THE PARTIES INVOLVED WITH GENERATION / DISTRIBUTION OF ELECTRICITY REQUIRING TRANSMISSION OF POWER IN THE GRID ARE TO COMPLY WIT H DIRECTION OF NRLDC AND REGULATORY COMMISSION ENSURING INTEGRATED GRID OPER ATION AND FOR ACHIEVING THE MAXIMUM ECONOMY AND EFFICIENCY IN THE OPERATION OF THE POWER SYSTEM IN THE STATE, THE QUESTION OF ANY PERSON RENDERING SER VICE TO ANOTHER DOES NOT ARISE. IN FACT AS A TRANSMISSION LICENSEE, PGCIL IS TO COMPLY WITH THE TECHNICAL STANDARD OF OPERATION AND MAINTENANCE OF TRANSMISSI ON LINES IN ACCORDANCE WITH THE GRIDS STANDARDS AS MAY BE SPECIFIED BY THE AUTHORITY. THE OPERATION AND MAINTENANCE OF TRANSMISSION LINES BY NRLDC/PGCI L AND DRAWING OF POWER FROM THESE LINES BY THE DISTRIBUTION COMPANIE S FOR TRANSMITTING ENERGY DOES NOT RESULT INTO ANY TECHNICAL SERVICES BEING R ENDERED TO THE ASSESSEE. BY THE OPERATION AND MAINTENANCE OF ITS OWN SYSTEM BY NRLDC/PGCIL, NO TECHNICAL SERVICES ARE RENDERED TO THE DISTRIBUTION COMPANIES AND 11 ITA NO. 4878/DEL/2016 CONSEQUENTLY THERE CANNOT BE ANY QUESTION OF DEDUCT ION OF TAX AT SOURCE UNDER SECTION 194J OF THE ACT IN THIS REGARDS. 12. THEREFORE, THE LD. AR SUBMITTED THAT THE ASSESS EE PURCHASES POWER FROM VARIOUS GENERATORS, DISTRIBUTION COMPANIES OR TRADE RS FROM ALL ACROSS THE COUNTRY. THE POWER SO PURCHASED BY THE ASSESSEE IS INJECTED BY THE GENERATING COMPANIES / DISTRIBUTION COMPANIES IN THE STATE / C ENTRAL GRID DEPENDING UPON THEIR CONNECTIVITY AT THEIR SUB-STATIONS AND I S DRAWN BY THE ASSESSEE AT GREATER NOIDA AT ITS R C GREEN OR SURAJPUR SUB-STAT IONS IN THE GRID. AS PER THE OPEN ACCESS APPLICATION, THE ASSESSEE IS ALLOWED TO DRAW POWER AT ITS SAID SUB- STATIONS ONLY TO THE EXTENT IT HAS PURCHASED THE PO WER. AS FAR AS THE ASSESSEE IS CONCERNED, THE POWER PURCHASED BY IT FROM THE GE NERATORS, DISTRIBUTION COMPANIES OR TRADERS AS STATED ABOVE, IS MEASURED A ND RECEIVED BY IT ONLY AT THE SAID SUBSTATIONS SITUATED IN THE GRID. IN OTHER WORDS, THE POWER PURCHASED BY THE ASSESSEE IS AVAILABLE TO IT ONLY AT THE SUB- STATIONS AND TRANSMISSION AND WHEELING OF THE POWER FROM THE GENERATOR TO THE SAI D SUB-STATIONS IS MERELY AN INTEGRAL PART OF SUCH PURCHASE. THE LD. AR SUBMITTED THAT IN SUBSTANCE, THE CHARGES PAID BY THE ASSESSEE FOR SUCH TRANSMISSION AND WHEELING OF POWER FORMS PART OF THE PURCHASE COST OF POWER AND ACCORDINGLY THERE CANNOT BE ANY QUESTION OF RENDERING ANY TECHNICAL SERVICE BY NRLD C/ PGCIL/ STUS REQUIRING DEDUCTION OF TAX AT SOURCE U/S. 194J OF THE ACT. TH US, THE LD. AR SUBMITTED THAT TRANSMISSION CHARGES DOES NOT COME UNDER THE P URVIEW OF DEFINITION OF FEES FOR TECHNICAL SERVICES AND ACCORDINGLY NO TAX IS REQUIRED TO BE DEDUCTED AT SOURCE FROM THE PAYMENTS THEREOF. 13. THE LD. AR FURTHER SUBMITTED THAT THE CIT (APPE ALS) UPHELD THE ORDER OF THE ASSESSING OFFICER WITHOUT CONSIDERING THE DECIS ION OF HIS PREDECESSOR CIT (APPEALS) IN ASSESSEES OWN CASE FOR THE SUBJECT YE AR ITSELF AND VARIOUS HONBLE COURT OF THE COUNTRY INCLUDING HONBLE APEX COURT A S ABOVE. THUS, THE LD. AR REITERATED THAT TRANSMISSION OF ELECTRICITY WAS AUT OMATIC THROUGH THE NETWORK OR EQUIPMENT WITHOUT ANY HUMAN INTERVENTION. THOUGH , THE SKILLED TECHNICAL 12 ITA NO. 4878/DEL/2016 PERSONNEL PROFESSIONAL WERE MAINTAINING THE SYSTEM OPERATED BY PGCIL, IT WAS MAINTAINING ITS OWN SYSTEM THROUGH SUCH PROFESSIONA LS. THE TRANSMISSION OF ELECTRICITY DOES NOT INVOLVE USE OF SUCH HUMAN INTE RVENTION AND ACCORDINGLY CANNOT BE QUALIFIED AS FEES FOR TECHNICAL SERVICES. THUS, THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE NOT ONCE BUT ON S EVERAL OCCASIONS AS STATED ABOVE. ACCORDINGLY, THE CIT (APPEALS) ERRED IN UPHO LDING THE ORDER OF THE ACIT IN HOLDING THAT THAT PROVISIONS OF SECTION 194J OF THE ACT WILL BE APPLICABLE WHILE MAKING PAYMENT OF TRANSMISSION AND WHEELING C HARGES AND THEREBY DISALLOWING THE SAID EXPENSES UNDER SECTION 4O(A)(I A) OF THE ACT. 14. THE LD. AR IN RESPECT OF GROUND NO. 6(D), SUBMI TTED THAT THE AMOUNT CONSIDERED BY THE ASSESSING OFFICER AMOUNTING TO RS . 24,70,24,128/- COMPRISES OF TRANSMISSION CHARGES AMOUNTING TO RS. 23,53,75,128 AS STATED ABOVE, WHEREAS THE BALANCE AMOUNT COMPRISED OF OPER ATING CHARGES AND NON- REFUNDABLE APPLICATION FEE ON WHICH TAX IS NOT DEDU CTIBLE UNDER ANY PROVISION OF THE ACT. THE LD. AR SUBMITTED THAT WITHOUT PREJU DICE TO THE CONTENTION OF THE ASSESSEE IN THIS REGARD, EVEN ASSUMING THOUGH N OT ADMITTING THAT TAX IS REQUIRED TO BE DEDUCTED AT SOURCE UNDER SECTION 194 J OF THE ACT ON TRANSMISSION CHARGES AS HAS BEEN ALLEGED BY THE ASS ESSING OFFICER, THE QUANTUM OF PURPORTED TRANSMISSION AND WHEELING CHAR GES CONSIDERED BY THE ASSESSING OFFICER SHOULD BE RESTRICTED TO RS. 23,53 ,75,128/- INSTEAD OF RS. 24,70,24,128/- IN VIEW OF THE FACT THAT NO TAX IS L EGALLY REQUIRED TO BE DEDUCTED AT SOURCE FROM THE AMOUNT PAID TOWARDS OPERATING CH ARGES AND APPLICATION FEES. 15. THE LD. AR IN RESPECT OF GROUND NO. 6(E), SUBMI TTED THAT OUT OF THE TOTAL AMOUNT OF RS. 24,70,24,128 AN AMOUNT OF RS. 23,85,8 2,165 WAS PAID BY THE ASSESSEE DIRECTLY TO NRLDC/UPSLDC/UPPTCL AND THE BA LANCE AMOUNT OF RS.84,41,963/- WAS PAID TO VARIOUS TRADERS AS REIMB URSEMENT OF SUCH TRANSMISSION CHARGES PAID BY THEM TO NRLDC AGAINST BACK TO BACK INVOICES RAISED ON THEM BY NRLDC/UPSLDC/UPPTCL. THE RESPECTI VE TRADERS HAVE 13 ITA NO. 4878/DEL/2016 BEEN REIMBURSED BY THE ASSESSEE ON ACCOUNT OF THEIR PAYMENTS TO NRLDC/UPSLDC/UPPTCL/PGCIL, AS THE CASE MAY BE. THE LD. AR FURTHER SUBMITTED THAT WITHOUT PREJUDICE, THE CIT (A) HAS A PPRECIATED THAT THE SAID AMOUNT OF RS.84,41,963/- IS IN THE NATURE OF REIMB URSEMENT OF THE COST. THE PROVISIONS OF CHAPTER XVTI-B ARE NOT APPLICABLE TO SUCH REIMBURSEMENT OF COSTS SINCE THERE IS NO PAYMENT OF INCOME/REVENUE B Y THE ASSESSEE. THUS WHEN NO INCOME IS PAID BY ASSESSEE TO THE TRANSMISS ION COMPANY, THE QUESTION OF DEDUCTION OF TAX AT SOURCE DO NOT OTHER WISE ARISE EVEN WHEN UNDER CERTAIN SECTIONS OF CHAPTER XVII-B LIABILITY OF TDS IS ON PAYMENT OF ANY SUM AND UNDER CERTAIN SECTIONS IT IS ON PAYMENT OF INCO ME AS ULTIMATELY THE TAX IS ON THE INCOME AND DEDUCTION OF TAX AT SOURCE IS ONL Y ONE OF THE MODE OF COLLECTION AND RECOVERY OF THE TAX. ACCORDINGLY, WH EN THERE IS NO LIABILITY TO DEDUCT TAX AT SOURCE, PROVISIONS OF SECTION 40(A)(I A) OF THE ACT WOULD NOT BE APPLICABLE. THE CIT (A) HAS NOT TAKEN COGNIZANCE TH AT THE DELHI ITAT, BEING THE JURISDICTIONAL TRIBUNAL OF THE ASSESSEE IN THE DAKSHIN HARYANA BIJLI VITRAN NIGAM LTD. (SUPRA) HAS ALSO DEALT WITH IDENTICAL SITUATION AND THAT T OO INVOLVING NRLDC/UPSLDC/UPPTCL, NAMELY THE REGULATOR Y AUTHORITIES IN THE CASE OF THE ASSESSEE, AND HELD THAT AS THE PAYMENT WAS TOWARDS REIMBURSEMENT OF COST INCURRED FOR TRANSMISSION OF ELECTRICITY BY THE UPPTCL, THE ASSESSEE CANNOT BE HELD TO BE IN DEFAULT. THE L D. AR FURTHER SUBMITTED THAT WITHOUT PREJUDICE TO THE SUBMISSIONS MADE BY T HE ASSESSEE WITH RESPECT TO GROUND NO. 6(A) TO 6(D) ABOVE, THE CIT (A) HAS N OT CONSIDERED THAT EVEN OTHERWISE, NO TAX IS REQUIRED TO BE DEDUCTED AT SOU RCE FROM THE IMPUGNED AMOUNT OF RS. 84,41,963 OUT OF THE TOTAL EXPENDITUR E ON TRANSMISSION AND WHEELING CHARGES OF RS. 24,70,24,128 INCURRED BY TH E ASSESSEE DURING THE YEAR UNDER CONSIDERATION, BEING REIMBURSEMENT OF COST. 14 ITA NO. 4878/DEL/2016 16. THE LD. DR SUBMITS THAT THE FACTUAL POSITION AN D LEGAL POSITION STATED BY THE LD. AR IS CORRECT. THE DR RELIED UPON THE ORDER S OF THE ASSESSING OFFICER AND THE CIT(A). 17. WE HAVE HEARD BOTH THE PARTIES AND PERUSED ALL THE RECORDS. AS REGARDS GROUND NOS. 1, 2, 3, 4(A), 4(B), 5(A) AND 5(B) ARE NOT PRESSED BY THE LD. AR AS THE SAME ARE ACADEMIC AND BECOMES INFRUCTUOUS. THE REFORE, GROUND NOS. 1, 2, 3, 4(A), 4(B), 5(A) AND 5(B) ARE DISMISSED. AS RELA TES TO GROUND NOS. 6(A) TO 6(E) REGARDING DISALLOWANCE UNDER SECTION 40(A)(IA) FOR NON-DEDUCTION OF TAX ON PAYMENT OF TRANSMISSION CHARGES THE SAME IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN C ASE FOR A.Y. 2011-12 & 2012- 13 (ITA NOS. 5442 & 5443/DEL/2015 ORDERS DATED 29. 11.2017 16.11.2017. ACIT VS. NOIDA POWER COMPANY LTD.) RELEVANT EXTRACT OF 2012-13 ORDER IS AS UNDER:- 6 WE FIND THAT SECTION 194J WOULD HAVE APPLICATION ON LY WHEN THE TECHNOLOGY OR TECHNICAL KNOWLEDGE, EXPERIENCES/SKIL LS OF A PERSON IS MADE AVAILABLE TO OTHERS WHICH CAN BE FURTHER USED BY HI M FOR ITS OWN PURPOSE AND NOT WHERE BY USING TECHNICAL SYSTEMS, SERVICES ARE RENDERED TO OTHERS. RENDERING OF SERVICES BY ALLOWING USE OF TECHNICAL SYSTEM IS DIFFERENT THAN CHARGING FEES FOR RENDERING TECHNICAL SERVICES. IN THE PRESENT CASE NO SCIENTIFIC KNOWLEDGE, EXPERIENCE OR SKILL IS MADE AVAILABLE/RE NDERED BY THE PGCIL TO THE ASSESSEE. FROM THE RECORDS, WE HAVE SEEN THAT T HE ASSESSEE ITSELF HAS ITS OWN ENGINEERS AND TECHNICIANS WHO CONSISTENTLY MONI TOR AND SUPERVISE THE FLOW OF THE ELECTRICITY TO ITS SYSTEM AND ULTIMATEL Y SUPPLIES TO ITS CUSTOMERS WHICH ACCORDING TO LD. CIT(A) ARE THE DESIGNATED FU NCTION OF POWER GRID WHICH DO NOT AMOUNT TO PROVIDING TECHNICAL SERVICES WITHI N THE MEANING OFEXPLN.2 TO SECTION G(I)(VII) OF THE ACT. MOREOVER, WE ALSO IN COMPLETE AGREEMENT WITH THE JUDGMENT OF HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. BHARATI CELLULAR LIMITED [175 TAXMANN 573 (DEL)] AFFIRMED BY THE HON BLE SUPREME COURT IN 193 TAXMAN 97(SC) WHEREIN, IT HAS BEEN HELD THAT TE CHNICAL SERVICES WHICH ARE RELEVANT FOR THE PURPOSE OF SECTION 194J WOULD BE THOSE TECHNICAL SERVICES 15 ITA NO. 4878/DEL/2016 WHICH INVOLVE HUMAN INTERFACE/ELEMENT. IN OTHER WOR DS, THE EXPRESSION 'TECHNICAL SERVICE' COULD HAVE REFERENCE TO ONLY TE CHNICAL SERVICE RENDERED BY A HUMAN AND THAT IT WOULD NOT INCLUDE MY SERVICE PROV IDED BY MACHINES OR ROBOTS. HOWEVER AS AGAINST ABOVE CONTENTION WE FIND THAT THE AO HAS COMPLETELY FAILED TO BRING RELEVANT MATERIALS, WHAT SOEVER, ON RECORD TO PROVE THE EXISTENCE OF HUMAN INTERFACE/ELEMENT IN THE PRE SENT CASE. IN VIEW OF THE ABOVE, WE FIND THAT SUCH TRANSMISSION AND WHEELING CHARGES PAID BY THE ASSESSEE DOES NOT COME WITHIN THE PURVIEW OF FEES F OR TECHNICAL SERVICE AS DEFINED UNDER EXPLANATION 2 TO SEC G(I)(VII) OF THE ACT AND ACCORDINGLY NO TAX IS REQUIRED TO BE DEDUCTED BY THE ASSESSEE U/S. 194J T HEREFROM. HENCE, THE ACTION OF THE AO IN TREATING THE ASSESSEE TO BE AN ASSESSEE-IN- DEFAULT U/S. 201(1) OF THE ACT AND THE ORDER DATED 27.3.2014 PAS SED U/S. 201(1 )/201(1A) OF THE I.T. ACT WERE RIGHTLY DELETED BY THE LD. CIT (A), WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART, HENCE, WE UPHOLD THE ACTI ON OF THE LD. CIT(A) AND REJECT THE GROUND RAISED BY THE REVENUE. AS RELATES TO GROUND NO. 6(A) TO (E) THE HONBLE DE LHI HIGH COURT IN CASE OF CIT VS. DELHI TRANSCO LTD. (SUPRA) CONSIDERING THE PROV ISIONS OF SECTION 194J OF THE ACT HELD THAT WHEELING CHARGES PAID FOR TRANSPORTAT ION OF ELECTRICITY CANNOT BE CHARACTERIZED AS FEE FOR TECHNICAL SERVICE. RELEVAN T PORTION IS REPRODUCED BELOW: 31 ........ THE SYSTEM OPERATED BY PGCIL AND USED FOR TRANSMISS ION OF ELECTRICITY IS NO DOUBT MAINTAINED BY SKILLED TECHN ICAL PERSONNEL PROFESSIONAL. THIS ALSO ENSURES THAT PGCIL COMPLIES WITH THE STAN DARDS AND NORMS PUT IN PLACE BY THE STATUTORY REGULATIONS. HOWEVER, THE BE NEFICIARY OF SUCH SERVICES IS PGCIL ITSELF. PGCIL IS OPERATING AND MAINTAINING ITS OWN SYSTEM USING THE SERVICE OF ENGINEERS AND QUALIFIED TECHNICIANS. PGC IL IS IN THAT PROCESS NOT PROVIDING TECHNICAL SERVICES TO OTHERS, INCLUDING D TL. 32. A COMPARISON COULD BE MADE WITH THE SYSTEM OF D ISTRIBUTION OF SOME OTHER COMMODITY LIKE WATER. IT MIGHT REQUIRE THE OP ERATION AND MAINTENANCE OF WATER PUMPING STATION AND THE MAINTENANCE OF A N ETWORK OF PIPES. 16 ITA NO. 4878/DEL/2016 HOWEVER, WHAT IS CONVEYED THROUGH THE PIPES AND THE EQUIPMENT TO THE ULTIMATE CONSUMER IS WATER. THE EQUIPMENT AND PIPES HAVE TO NO DOUBT BE MAINTAINED BY TECHNICAL STAFF BUT THAT DOES NOT MEA N THAT A PERSON TO WHOM THE WATER IS DISTRIBUTED THROUGH USING THE PIPES AN D EQUIPMENT IS AVAILING OF ANY TECHNICAL SERVICE AS SUCH. THIS DECISION OF THE HONBLE DELHI HIGH COURT IS CO NFIRMED BY THE HONBLE APEX COURT. THE CONTENTIONS OF THE LD. AR WAS NOT REFUTE D BY THE LD. DR AND THE DECISIONS RELIED BY THE LD. AR SQUARELY COVERS THE ISSUES IN FAVOUR OF THE ASSESSEE THUS, GROUND NO. 6 (A) TO 6 (E) ARE ALLOWE D. AS RELATES TO GROUND NO. 7 & 8 ARE CONSEQUENTIAL TO GROUND NO. 4(A) TO 5(B), A ND THE LD. AR DID NOT PRESSED THE SAME. THEREFORE, GROUND NO. 7 AND 8 ARE DISMISSED. AS RELATES TO GROUND NO. 9 THE SAME IS CONSEQUENTIAL IN LIGHT OF THE FINDING GIVEN BY US HEREINABOVE. 18. THUS, THE APPEAL OF THE ASSESSEE IS PARTLY ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 19TH MARCH, 2018 . SD/- SD/- (N. K. SAINI) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED: 19 /03/2018 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR 17 ITA NO. 4878/DEL/2016 ITAT NEW DELHI DATE 1. DRAFT DICTATED ON 06/02/2018 PS 2. DRAFT PLACED BEFORE AUTHOR 06/02/2018 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2018 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 19.03.2018 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 1 9 .03.2018 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.