Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (10) TMI 551 - AT - Income TaxTDS u/s 194J - whether open access charges paid by the assessee towards transmission of electricity from its plants to various parts of the country is coming within the definition of royalty as defined u/s 9(1)(vi) of the Act? - Held that:- We find that the assessee has used transmission lines owned by M/s. Power Grid Corporation of India Ltd. for transmitting power from its plant to various parts of India. The assessee has paid open access charges through M/s. Reliance Energy Trading Ltd. for use of transmission lines. There is nothing on record to show that the assessee has used any patent, invention, model, design, secret formula or process or trade mark or similar property and associated rights in that property to say that the open access charges paid by the assessee is coming within the meaning of royalty as defined u/s 9(1)(vi) of the Act. In our considered view, the A.O. without understanding the provisions, brought in the concept of definition of royalty provided in sub clause (iva) of explanation2 of section 9(1)(vi) of the Act, the use or right to use any industrial, commercial or scientific equipment to cover open access charges incurred by the assessee within the definition of royalty as defined u/s 9(1)(vi) of the Act. Therefore, we are of the view that open access charges incurred by the assessee towards transmission of electricity from its plant to various parts of the country, through transmission lines owned by M/s. Power Grid Corporation of India is not a royalty and accordingly, the assessee need not to deduct TDS under the provisions of section 194J of the Act. The CIT(A) after considering the relevant facts rightly deleted additions made by the A.O. We do not see any error or infirmity in the order passed by the CIT(A),. Hence, we inclined to uphold the CIT(A) order and dismiss the appeals filed by the revenue. - Decided in favour of assessee.
|