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of <h1>Levy of GST on electricity regulatory commission fees ruled not leviable; show cause notice set aside.</h1> Levy of GST on fees charged by electricity regulatory commissions was examined and the services performed under the Electricity Act in discharge of ... Levy of Goods and Services Tax on fees charged by electricity regulatory commissions - Regulatory and quasi-judicial functions of a Commission constituted under the Electricity Act, 2003 - Functions under Section 86 of the Electricity Act, 2003 - Exclusion of services rendered by a court or tribunal (Schedule III of the CGST Act) - Definition of 'business' and 'consideration' under the CGST Act (Section 2(17) and Section 2(31)) - Supply in the course or furtherance of business - Interpretation of 'services' vis-à-vis Section 2(102) of the CGST Act - HELD THAT:- After considering the arguments on behalf of petitioner, stand of respondents in aforesaid matter and scrutinizing applicable provisions of law, it has been held by Delhi High Court that regulation of tariff, inter-State Transport transmission of Electricity or issuance of licence cannot be construed as activities undertaken or functions discharging furtherance of business but they are in extension of statutory obligation placed upon a Commission to regulate these subjects. It is informed that this decision was challenged by the department by filing SLP (Civil) No. 19662 of 2025, which has been dismissed by Hon’ble the Supreme Court [2025 (7) TMI 1523 - SC ORDER] (Annexure P-27), thus matter has attained finality. Respondents fairly states that the controversy involved in present writ petition is indeed identical and he is unable to draw out any distinction which would call for different dispensation in this matter. Accordingly, present writ petition is allowed and show cause notice No. 79 dated 28.06.2024 is set aside. Issues: Whether fees received by a State Electricity Regulatory Commission (petition fee, ARR processing fee and license fee) for discharge of functions under Section 86 of the Electricity Act, 2003 attract levy of GST.Analysis: The decision examines the applicability of the CGST Act definitions and exclusions to the fees received by a statutory commission. Relevant provisions considered include the statutory definition of 'business' (Section 2(17)), 'consideration' (Section 2(31)), the concept of 'supply' in Section 7, the expansive definition of 'services' (Section 2(102)), and the express exclusion in Schedule III for services rendered by a court or tribunal. The Analysis applies these provisions to the nature of functions exercised by a commission under the Electricity Act, 2003 (including duties under Section 86), assessing whether regulatory and quasi-judicial functions amount to activities in furtherance of business or constitute consideration for supply of goods or services. The Analysis also relies on a directly on-point decision of the Delhi High Court (dated 15.01.2025) holding that regulation of tariff, inter-State transmission regulation and issuance of licences are statutory regulatory/quasi-judicial functions and not taxable supplies, and notes that the Supreme Court dismissed the department's challenge, rendering that decision final.Conclusion: GST does not apply to the fees in question; the show cause notice levying GST on petition fee, ARR processing fee and license fee is set aside and the writ petition is allowed in favour of the petitioner commission.
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