2018 (8) TMI 486

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....aro Power Supply Corporation Ltd., (in brief M/s BSPCL) were engaged in the production of electricity and steam. M/s Steel Authority of India Limited (in brief SAIL) with a view to strengthen its core business of steel manufacturing, transferred its entire business and undertaking of 302 MW power plant having additional steam generation capacity of 660 tonnes/hour at Bokaro Steel Plant to its subsidiary Company, M/s BSPCL for consideration and entered into a Power and Steam Purchase Agreement (PSPA), between M/s BPSCL & M/s SAIL. It was agreed to supply the steam and electricity to M/s SAIL as per their requirement. M/s BPSCL are producing electricity and steam on behalf of M/s SAIL, Bokaro Steel Plant and supplied the same to M/s SAIL on r....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....inkage was available to M/s SAIL and in terms of the Power and Steam Purchase Agreement, the supply of coal by SAIL was only a temporary arrangement till the coal is available to the Respondent. The ld.Advocate further submits that to qualify for exclusion, the process must amount to manufacture, and generation of electricity does not amount to "manufacture" and is covered by Entry 84 of List I (Union List) of Schedule VII to the Constitution. It is also the submission of the ld.Advocate that the issue is covered by the decision of the Tribunal in the following cases : (i) CMS (India) Operations & Maintenance Co. P.Ltd. Vs. CCE: 2007 (7) S.T.R. 369 (Tri.-Chennai) ; (ii) NTPC SAIL Power Co.Pvt. Ltd. Vs. CCE, Bolpur: 2012 (277) ELT 221 ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....lause (f) of Section 2 of the Central Excise Act, 1944." As per this definition, any activity involving manufacture of any goods within the meaning of clause (f) of Section 2 of the Central Excise Act, 1944 is not subject to tax under the head Business Auxiliary Service. It is a settled position that electricity is goods manufactured in the sense envisaged in clause (f) of Section 2 of the Central Excise Act, 1944. The Hon'ble High Court of Orissa in Orient Paper & Industries Ltd. v. Orissa State Electricity Board (supra), had upheld imposition of Central Excise duty on electricity, electricity being manufactured goods as defined in the Central Excise Act '44. Therefore, we find that the argument of the appellants that the services invol....