TaxTMI 
TaxTMI 
2014 (12) TMI 1159
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....14/13-14, upholding the Assessing Officer's action in raising identical TDS demands of Rs. 2,36,926/-, Rs. 16,43,091/-, Rs. 12,96,300/- 9,34,154/-, Rs. 91,187/-, Rs. 8,74,696/- and Rs. 5,41,434/- respectively, in proceedings under section 201(1) and 201(1A) of the Income-tax Act, 1961 (in short the 'Act'). 2. Both parties inform at the outset that the issue involved is identical in all appeals i.e demand u/s 201 r.w.s 201(1A). Thus, we take up I.T.A.No.2584/Mds/2014 in case of M/s Auro Mira Biopower India Pvt. Ltd. as the 'lead' case. 3. The assessee is a 'company' generating biomass renewable energy which is sold to third parties through TNEB's power grid system. It is a deductor for 'TDS' purposes. The department conducted a spot verifi....
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....ges @ Rs. 28.97 per MWHr for utilizing the power utility's transmission network with scheduling and system operation charges @ Rs. 500 per day per transmission and wheeling charges @ Rs. 14.74 per unit for transactions carried out below 336W i.e 22KV and 11KV voltage. The Assessing Officer in his order dated 19.3.2013 treated the aforesaid wheeling, scheduling and transmission activities as 'technical' services. The payments made in question were accordingly held as 'fee for technical services'. He observed that this wheeling and transmission involved maintenance of properly regulated flow of electrical energy at the required quantity and voltage. Case law of Ajmeer Vidyut Vitran Nigam Ltd [2012] 76 DTR (AAR) 209 was quoted. In the end, the....
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.... For better understanding and easy reference sec.194J of the Act is reproduced as under: 194J - (1) Any person, not being an individual or a Hindu undivided family who is responsible for paying to a resident any sum by way of- (a) Fees for professional services, or (b) Fees for technical services [or] (ba) any remuneration or fees or commission by whatever name called other than those on which tax is deductible under section 192, to a director of a company, or] (c) Royalty, or (d) Any sum referred in clause (va) of section 28, ] shall at the time of credit of such sum to the account fo the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode whichever is earlier, deduct an amount equal....
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....BEG and Grid/Distribution system through "Interface Line" an electric line. This interfacing of assessee's generators with the Distribution Licensee was done through 110KV Radial Lines as per clause 2 of the agreement. Sub-clause(2) of clause 2 of agreement says that the works of interconnecting the Generators upto the point of interconnection shall be executed by the Distribution Licensee/State Transmission Utility i.e. TANGEDCO. As per sub-clause (3) of clause 2 of the agreement, parties to the agreement shall comply with the provisions contained in Central Electrical Authority Authority Regulations 2007 which includes the following namely; (a) Connecting agreement (b) Site responsibility schedule (c) Access at connection site (d)....
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....hat the wheeling. charges are subject to TDS u/s 194J of the Act. Hence, I decline to interfere in the order of the ITO u/s 201(1)/201(lA) of the Act. 3.4 Regarding the assessee's reliance on the decision of ITAT Jodhpur Bench in the case of ITO(TDS) Udaipur vs Hindustan Zinc Limited (2013) 40 Taxmann.com 42 which has also referred to the decision of Jaipur Bench of the, Tribunal in the case of Jaipur Vidyut Vitran Nigam Limited vs DCIT (2009) 123 TTJ 888(which was also relied on by the assessee), I am of the humble opinion that the nature of work, process involved, etc in these kinds of technical work certainly involves human element. The decisions relied on by the assessee says that knowledge of person is not made available in these o....
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..... The sole question that arises for our adjudication is as to whether these wheeling, scheduling and transmission activities amount to 'technical services' u/s 194J(1) Explanation (b) or not. This provision imports definition of 'technical services' from section 9(1)(vii) Explanation 2. We find from the paper book on record that a co-ordinate bench in [2013] 40 taxmann.com 42 (Jodhpur Trib.) ITO (TDS) Udaipur vs Hindustan Zinc Ltd in identical wheeling and transmission charges paid to the State Power Utility Department holds that mere availing the power network system and making payments in lieu thereof does not amount to paying any 'fee for technical services'. It has been observed that these activities do not involve any human element as ....