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2011 (11) TMI 125 - AT - Income TaxTax deduction at source - electricity transmission charges - use of an asset vs benefit from an asset - Held that:- For the purpose of Section 194I, the 'control' and 'possession', in legal terms, of an asset may not not needed to be with the person benefiting from the asset in question, it is a condition precedent for invoking Section 194I that the asset, for the use of which the payment in question is made, should have some element of its control by the assessee. Here is a case in which the assessee has no control over the operations of the transmission lines, and the payments have been made for the services of transmission of electricity and not the use of transmission wires per se. It is a significant fact that these transmission lines are not only being used for transmission of electricity to the assessee but also for transmission to electricity to various other entities. Such payment for the services of transmission of electricity can't be qualified as rent. Decided against the Revenue. The core consideration for invoking Section 201(1) is not the lapse on the part of the tax deductor, but loss of revenue to the exchequer. As long as taxes payable by the recipient of income are paid, the provisions of Section 201(1) cannot be pressed into service. Decided against the Revenue.
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