आयकर अपील(cid:547)य अ(cid:876)धकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘ DB-A ‘ Bench, Hyderabad (cid:302)ी (cid:874)वजय पाल राव, उपाÚ य¢ एवं (cid:302)ी मधुसूदन साव(cid:875)डया, लेखा सदè य के सम¢ ।

Before Shri Vijay Pal Rao, Vice-President A N D Shri Madhusudan Sawdia, Accountant Member आ.अपी.सं /ITA No. 1585/Hyd/2025 (िनधा१रण वष१/Assessment Year: 2018-19)

Transmission Corporation Vs. Dy. CIT of Telangana Ltd Circle 2(1)

Hyderabad Hyderabad PAN: AAFCT0166J आ.अपी.सं /ITA No. 1258/Hyd/2025 (िनधा१रण वष१/Assessment Year: 2018-19)

Dy. CIT Vs. Transmission Corporation Circle 2(1) of Telangana Ltd Hyderabad Hyderabad PAN: AAFCT0166J (Appellant) (Respondent)

िनधा१ौरती (cid:554)ारा/Assessee by: CAs M.V. Anil Kumar &

Sreelekha राज(cid:830) व (cid:554)ारा/Revenue by: Smt. U. Mini Chandran, CIT(DR)

सुनवाई की तारीख/Date of hearing: 23/03/2026 घोषणा की तारीख/Pronouncement: 30/03/2026 आदेश/ORDER Per Madhusudan Sawdia, A.M.:

These cross appeals are filed by the Transmission Corporation of Telangana Ltd (“assessee”) as well as the Revenue feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”) dated 11.07.2025 for the A.Y

2018-19.

3. The brief facts of the case are that the assessee is a limited company engaged in the business of transmission of electrical energy in the State of Telangana. The assessee filed its return of income for the Assessment Year 2018–19 on 29.09.2018, declaring loss of Rs.119,05,67,050/-. Subsequently, the assessee revised the return of income on 30.03.2019, declaring loss at Rs.227,33,40,420/- under the normal provisions of the Income Tax Act, 1961 (“the Act”) and profit of Rs.102,46,25,988/- under MAT provisions. The case of the assessee was selected for scrutiny under CASS and accordingly, notice under section 143(2) of the Act was issued to the assessee by the Learned Assessing Officer (“Ld. AO”) on 29.09.2019. After considering the submissions of the assessee, the Ld. AO made addition of Rs.121,92,80,037/- on account of interest from the deposits of unutilised LIS fund, Rs.2,38,48,596/- on account of provision for non-moving, obsolete and unserviceable material and Rs.2,47,01,752/- on account of disallowance of belated payments of provident fund. The Ld. AO also rejected the claim of the assessee on account of TDS credit on interest receipt of Rs.121,92,80,037/-. Accordingly, the Ld. AO completed the assessment under section 143(3) of the Act dated 31.01.2020, computing the loss of the assessee at Rs.100,55,10,035/- under the normal provision of the Act. The Ld. AO also made all the three additions to the book profits of the assessee for the purpose of computing the profits under the provisions of MAT and computed the book profit under MAT provisions at Rs.229,24,56,373/-.

4. Aggrieved by the order of the Ld. AO, the assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A), after considering the submissions of the assessee, deleted the addition of Rs.121,92,80,037/- made by the Ld. AO on account of interest from the deposit of unutilized LIS fund. However, the Ld. CIT(A) sustained the other two additions made by the Ld. AO, namely Rs.2,38,48,596/- on account of provision for non-moving, obsolete and unserviceable material and Rs.2,47,01,752/- on account of disallowance of belated payment of provident fund. The Ld. CIT(A) also sustained the rejection of TDS credit on interest of Rs.121,92,80,037/- made by the Ld. AO.

5. Aggrieved by the order of the Ld. CIT(A), both the Revenue as well as the assessee are in appeal before this Tribunal. We shall first take up the appeal of the Revenue for adjudication.

ITA No.1258/Hyd/2025 (Revenue’s Appeal):

6. The Revenue has raised the following grounds of appeal:

7. At the outset, the Learned Departmental Representative (“Ld. DR”) submitted that the only issue arising out of the grounds of appeal of the Revenue is with regard to the deletion made by the Ld. CIT(A) of