Electricity sale in inter unit

[RAM SHARMA]

Dear Experts, What is the legal obligation if we sale electricity to our inter unit or sister concer. Can we do it. Please advice excise and service tax point of view or any other legal obligation.Thanks

AI Summary

Legal Insights on Selling Electricity to Sister Concerns: Excise, Service Tax, and CENVAT Credit Obligations Explained A user inquired about the legal obligations of selling electricity to an inter-unit or sister concern, specifically from the perspective of excise and service tax. One expert noted that electricity is neither considered goods nor a specified service, thus not subject to excise or service tax. Another mentioned electricity is classified as goods at a nil rate under Central Excise, with VAT often exempted. Another expert highlighted the need to reverse Cenvat Credit proportionally if taken on inputs related to electricity generation. It was also noted that CENVAT credit is not applicable for excess electricity sold externally.