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"I, P.V.S.U Mahesh son of Late P.L. Narasimham aged 46 years, in the capacity of Assistant General Manager (Finance), IISCO Steel Plant, Steel Authority of India Limited (hereinafter referred to as "SAIL"), do hereby certify that as per the contract agreement dated October 16, 2007 between SAIL and consortium comprising of M/S POSCO Engineering & Construction Company Limited, South Korea (hereinafter referred to as "POSCO") and M/S Nagarjuna Construction Company Limited (hereinafter referred to as "NCC"), POSCO is under an obligation to provide training to SAIL staff in India [Refer clause 7.8, page 73]. It is further certified that no training has been conducted till date in India and as and when training shall be imparted to SAIL staff POSCO shall not be entitled to any separate consideration [Refer Pricing Schedule - Table 14B. page 27] because hours to be spent by POSCO in imparting training in India had been considered to be a part of consideration for Foreign Supervision Services paid or payable by SAIL to POSCO.
This certificate has been issued on a specific request of POSCO for its income-tax proceedings in Idnia. And this certificate does not bind SAIL commercially or legally.
Sd/-
(P.V.S.U. Mahesh) AGM (Finance) SAIL-ISP, Burnpur."

I, P.V.S.U Mahesh son of Late P.L. Narasimham solemnly affirm that this certificate is based on the factual terms of the contract and the actual activities undertaken and is not intended to provide any comment on the tax implication which may arise on account of the said payments in the hands of M/S POSCO Engineering & Construction Company.

39. We further find, SAIL has issued a certificate copy of which is placed at page 80 of the paper book wherein they have certified that no liability has arisen in the said years. The relevant extract of the certificate reads as under:-

"I P.V.S.U Mahesh son of Late P.L. Narasimham aged 46 years, in the capacity of Assistant General Manager (Finance), IISCO Steel Plant, Steel Authority of India Limited (hereinafter referred to as "SAIL"), do hereby certify that as per the contract agreement dated October 16, 2007 between ITA Nos.7715 & 945/Del/2017 SAIL and consortium comprising of M/S POSCO Engineering & Construction Company Limited, South Korea (hereinafter referred to as "POSCO") and M/S Nagarjuna Construction Company Limited (hereinafter referred to as "NCC"), defect liability and liquidated damages are in the nature of trade warranties."
"7.3. We are not convinced with the submissions advanced on behalf of the assessee in this regard. The primary question for our consideration is to decide the nature of Drawings and Documents for which such amount has been received. Page 1042 onwards of the paper book, which is a part of Appendix- 2, being the Time Schedule to the Contract agreement, throws light on the nature of Drawings and Documents. It starts with the Basic Engineering and extends to Drawings/Documents for Information/Review and then to As-Built Drawings and Documents. When we peruse the details under such broad categories, it can be seen that it refers to Site plan, Process flow sheet, GA & Sectional drawings for foundation of buildings and equipment, Layout and sections of roads, railway tracks, Colour Scheme, Soil Investigation Report, Preliminary Outline Drawings, Excavation outline Drawings, Design calculation for all electrical works, Conduit drawings and Cut out details etc. etc. We are unable to appreciate as to how such Designs and engineering can be considered as part of equipment to be supplied by the assessee from abroad. In fact, such Design and ITA No. 5787/Del/2013 POSCO Engineering & Construction Company Ltd. 41 drawings deal with every aspect of the erection and commissioning of the plant right from foundation of buildings and roads till the completion of the entire project. All such drawings are customized. It is totally incorrect to say that such Drawings and designs for which consideration of Euro 150900 was received be considered as offshore supply of equipments and hence exempted from taxation. Our view is fortified from the judgment of the Hon'ble jurisdictional High Court in Director of Income Tax Vs Rio Tinto Technical Services (2012)340 ITR 507 which reversed the finding given by the Tribunal that the consideration received was for a composite contract and hence could not be bifurcated. It has been held that in the absence of any bifurcation, an estimated allocation has to be made for tax purposes. From the above judgment, it is manifest that the contention of the Id. AR that the fees for design and drawing should be considered as part of supply of offshore equipment, is not sustainable"