Electricity ancillary services are taxable; government schemes like DDUGJY, IPDS, ADSMS taxed at 18%. Farmers' tube well services not exempt.

The ruling determined that ancillary services related to electricity distribution, such as connection and supervision, are not part of the composite supply of electricity and are taxable. Services provided under government schemes like DDUGJY, IPDS, and ADSMS are taxable at 18% as they are considered commercial and industrial. Additionally, services extended to farmers' tube wells by contractors are not exempt under agricultural service provisions.

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Issues Involved:
1. Whether the supply of services related to electricity distribution forms a composite supply.
2. Taxability of services provided by contractors for government schemes.
3. Applicability of concessional GST rates for specific government schemes.
4. Exemption status of services provided to farmers for agricultural purposes.

Detailed Analysis:

1. Composite Supply of Electricity Distribution Services:
- Issue: Whether services like connection, re-connection, supervision, erection of poles, and supply of meters are naturally bundled and form part of the composite supply of electricity.
- Discussion: The applicant argued that these services are ancillary and naturally bundled with the principal activity of electricity supply, hence exempt from GST. They cited various legal precedents and the definition of "composite supply" under Section 2(30) of the GST Act.
- Findings: The authority concluded that the exemption notification (Entry No. 25 of Notification No. 12/2017) only covers "Transmission or distribution of electricity" and not other services, which are thus taxable. The services are not naturally bundled as they can be provided independently and are charged separately.

2. Taxability of Services Under Government Schemes:
- Issue: Whether services provided under schemes like DDUGJY, IPDS, and ADSMS are liable to 12% GST.
- Discussion: The applicant contended that these schemes are for public welfare, funded by the government, and should attract a concessional GST rate of 12% as per Notification No. 24/2017.
- Findings: The authority held that the works under these schemes are commercial and industrial in nature, and thus, the concessional rate does not apply. The applicable GST rate is 18%.

3. Exemption for Agricultural Services:
- Issue: Whether services for extending the electricity distribution network to farmers' tube wells are exempt under Notification No. 14/2018.
- Discussion: The applicant argued that these services should be exempt as they are provided for agricultural use.
- Findings: The exemption under Notification No. 14/2018 applies only to services provided directly by the electricity distribution utility, not to services provided by contractors. Therefore, contractors' services are not exempt.

Conclusion:
1. Composite Supply: Only the transmission or distribution of electricity is exempt. Ancillary services like connection, re-connection, and supervision are taxable.
2. Government Schemes: Services under DDUGJY, IPDS, and ADSMS are not eligible for the concessional 12% GST rate and are taxable at 18%.
3. Agricultural Services: The exemption applies only to services provided directly by the electricity distribution utility, not to contractors.

Ruling:
- Composite Supply: Ancillary services are not part of the composite supply of electricity and are taxable.
- Government Schemes: Services under DDUGJY, IPDS, and ADSMS are taxable at 18%.
- Agricultural Services: Only services provided directly by the utility are exempt; contractors' services are taxable.

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