2023 (4) TMI 660

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ner confirming the demand of Rs. 13,43,09,415/- towards service tax on the amount collected by the appellant towards liquidated damages, supervision charges and hire charges. 2. The appellant is a public sector undertaking established by the Government of Madhya Pradesh for transmission of electricity within the city of Jabalpur and is a successor company of the State Electricity Board. For the transmission of electricity, the appellant is required to erect or construct electric sub-stations, electricity poles, electrical lines, provide consultation for transmission of electricity from one point to another, transmit electricity from the power grid or dams or power generation area to the city limits or to the customers. 3. A show cause....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... 2019 decided on 12.04.2022]. The learned counsel also pointed out that the Commissioner committed an illegality in holding that the appellant was liable to pay service tax on hire charges. 6. Dr. Radhe Tallo, learned authorized representative appearing for the department pointed out that for the hire charges the appellant could not substantiate the factual aspects and so the Commissioner was justified in confirming the demand. 7. The submissions advanced by learned counsel for the appellant and the learned authorized representative appearing for the Department have been considered. 8. Each of the heads under which service tax has been confirmed will be dealt with separately. CONSULTANCY SERVICES 9. The appellant provides con....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....equired to be treated as a provision of a single service of transmission and distribution of electricity, which service is exempted from payment of service tax. 11. In the present case the amount collected towards consultation services is in connection with services which are incidental to the transmission activities carried out by the appellant. The demand, therefore, cannot be sustained in the view of the aforesaid decision of the Tribunal. LIQUIDATED DAMAGES 12. The second issue that arises for consideration in this appeal is relating to the amount collected by the appellant towards liquidated damages or penalty. This issue was also examined by the Division Bench of the Tribunal in Madhya Pradesh Poorva Kshetra Vidyut Vitaran Co....