THE COMMISISONER OF INCOME-TAX vs. BANGALORE ELECTRICITY SUPPLY CO LTD

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ITA/207/2012HC KarnatakaKAHC01052290201220 March 2020Bench: ALOK ARADHE,M.NAGAPRASANNA4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the services rendered by KPTCL in analyzing and distributing electricity did not amount to technical services under Section 194J. Consequently, the interest levied under Section 201(1A) for non-deduction of TDS was deleted.

What were the facts?

The Revenue appealed a High Court decision regarding the applicability of Section 194J of the Income Tax Act to electricity distribution services. The core issue was whether the analysis and distribution of electricity by KPTCL constituted technical services attracting TDS provisions.

What were the issues?

Whether the distribution of electricity by KPTCL constitutes 'technical services' for the purpose of Section 194J, and consequently, whether interest under Section 201(1A) was rightly deleted.

Which sections of the Income-tax Act were involved?

Section 194J,Section 201(1A)

AI-generated summary — verify with the full judgment below

1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 20TH DAY OF MARCH, 2020 PRESENT

THE HON’BLE MR.JUSTICE ALOK ARADHE AND

THE HON’BLE MR.JUSTICE M. NAGA PRASANNA

ITA NO. 207 OF 2012

BETWEEN:

1.

THE COMMISSIONER OF INCOME-TAX, TDS, HMT BHAVAN, BELLARY ROAD, BANGALORE

2.

THE INCOME-TAX OFFICER-TDS, WARD-16(1), HMT BHAVAN, BELLARY ROAD, BANGALORE …APPELLANTS (BY SRI. K.V.ARAVIND, ADV.)

AND:

BANGALORE ELECTRICITY SUPPLY CO., LTD., CORPORATE OFFICE, IV FLOOR, K.R. CIRCLE, BANGALORE-560 001.

…RESPONDENT (BY SRI. A. SHANKAR, SENIOR ADV. A/W SRI.M.LAVA ADVOCATE)

THIS ITA IS FILED UNDER SECTION 260A OF THE INCOME TAX ACT, 1961 PRAYING TO ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE ITAT, BANGALORE IN ITA NO.541/Bang/2010 DATED 16/03/2012 AND CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE INCOME TAX OFFICER, TDS, WARD-16(1), BANGALORE, ETC.,

THIS ITA COMING ON FOR HEARING, THIS DAY ALOK ARADE J., DELIVERED THE FOLLOWING:-

JUDGMENT

This appeal under Section 260-A of the Income Tax Act has been filed by the revenue which was admitted by a Bench of this Court vide order dated 18.09.2012 by framing the following the substantial questions of law: i) Whether the Tribunal was correct in holding that the analysis and distribution(SLDC) of electricity by KPTCL from generation point to the customers of the assessee involving utilization of sophisticated machineries, involvement of technical expertise, application of science, services of engineers, engagement

3 of qualified technicians and trained, skilled personnel/manpower does not amount to technical services to attract provisions of Section 194J of the Act?

ii) Whether the Tribunal was correct in deleting the interest levied under Section 201(1A) of the Act, for non-deduction of tax at source as required under Section 194J of the Act?

2.

When the matter was taken up today, learned Senior counsel for the respondent submitted that the aforesaid substantial question of law involved in this appeal have already been answered in favour of the assessee by a Division Bench of this Court vide judgment dated 22.03.2016 passed in ITA No.438/2012 and other connected matters. The aforesaid contention made by the learned Senior Counsel for the respondent could not be disputed by the learned counsel for the Revenue.

For the reasons aforesaid judgments, the substantial questions of law framed in this appeal are answered

4 against the revenue and in favour of the assessee. In the result the appeal is dismissed.

Sd/- JUDGE

Sd/- JUDGE

Psg*

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