TaxTMI 
TaxTMI 
2024 (2) TMI 1401
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....consumers various charges such as erection charges, contingency charges, supervision charges, development charges etc. for such erection of Bays, Sub-station and Transmission Lines which are required for transmission of electricity. For the purpose of said erection of Bays, Sub-station and Transmission Lines, the appellant receives work contract service from EPC Contractors. The appellant was served two show cause notices dated 20.10.2014 and 10.04.2015 for the period 2009-10 to 2012-13 and 2013-14 respectively demanding service tax on various charges recovered by the appellant from the consumers for the erection of Bays, Sub-stations and Transmission Lines under the category of Erection, Commissioning and Installation Service under Section 65 (zzd) of the Finance Act, 1994 and further service tax to the extent of 50% under reverse charge on work contract service received by the appellant. Further, show cause notice dated 20.10.2014 also demand interest on Cenvat credit which was never utilised by the appellant. After considering the reply submitted by the appellant, learned Commissioner by two orders-in-original, dated 20.10.2016 confirmed the said show cause notices against which....
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....n of facts particularly the appellant being a Government Company, moreover, the activities of the appellant is very well known to the department. Therefore the demand for the extended period is not sustainable. On limitation, he further submits that there is another issue of demand of interest of Cenvat credit, he submits that appellant have admittedly reversed the Cenvat credit without utilisation thereof, therefore no interest could have been demanded. He submits that the demand of interest is also covered in longer period in view of the following judgments, the limitation provided under Section 73(1) is also applicable for demand of interest therefore, the demand of interest is also time-barred. He relied on the following judgments:- (a) CCE Bill Forge P. Ltd - 2012 (279) ELT 209 (Kar) (b) Aban Offshore Ltd v CST - 2023 (70) GSTL 471 (c) Commissioner v TVS Whirlpool Ltd-2000 (119) ELT A177 (d) Commissioner v Emco Ltd-2015 (325) ELT A 104 (Bom) (e) Kwality Ice Cream Company v UOL-2012 (27) STR 8 (Del). 4. He submits that in the present case since the taking of the credit and its reversal clearly reflected in the record, suppression ....
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....not subject matter of challenge in the petition; (vii) revenue from power supply/transmission income for the financial year 2012-13 to the financial year 2017-18, which is clearly in terms of the impugned circular dated 1-3-2018, item-4 whereof clarifies that services by way of transmission or distribution of electricity by an electricity transmission or distribution utility is exempt from GST under Notification No. 12/17-C.T. (R) No. 25; the other services such as (i) application fee for releasing connection of electricity; (ii) rental charges against metering equipment; (iii) testing fee for meters/transformers, capacitors etc; (iv) labour charges from customers for shifting of meters or shifting of service line; (v) charges for duplicate bill provided by DISCOMS to consumers are taxable. Thus, it is crystal clear, that the impugned summons, except to the extent the same relates to services provided to MEGA, has been issued on the basis of the impugned circular. It appears that the respondents for the entire duration of the negative list regime seem to have proceeded on the basis that these services stand included in the transmission and distribution of electricity and,....
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....mely, the pre-negative list regime; (ii) from 1st July, 2012 to 30th June, 2017 that is negative list regime; and (iii) from 1-7- 2017 onwards, namely, the CGST/SGST regime. 10. Insofar as the first phase is concerned, the respondents do not dispute that the related/ancillary services to transmission and distribution of electricity are exempt from payment of service tax. The dispute, therefore, relates to the period of the negative list regime and the CGST/SGST regime. 11. Insofar as the second phase, namely, the negative list regime is concerned, with effect from 1-7-2012, Section 65B of the Finance Act, 1994 came to be amended and service tax became leviable on all services, other than those services specified in the negative list. Admittedly, transmission and distribution of electricity by an electricity transmission or distribution utility, finds place in the negative list and, is therefore, not exigible to service tax. 12. The first question that arises for consideration is whether services relating to transmission and distribution of electricity fall within the ambit of clause (k) of Section 66D of the Finance Act and, are therefore, exempt. In this....
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....ed by virtue of notifications. During the negative list regime, transmission and distribution of electricity has been placed in the negative list. Therefore, in all the three phases, what was exempted was "transmission and distribution of electricity". However, while for the pre-negative list phase, the respondents considered the services related to transmission and distribution of electricity as exempt under the exemption notifications, for the negative list regime and the GST regime, they seek to exclude such services from the ambit of transmission and distribution of electricity. From the affidavits-in-reply filed on behalf of the respondents, there is nothing to show as to how the very services, which stood included within the ambit of transmission and distribution of electricity now stand excluded. The sole refrain of the respondents is that in view of the fact that the exemption notification stands rescinded, the clarification also stands rescinded. What is lost sight of is that the clarification was only in respect of electric meters, whereas all related services were included within the ambit of transmission and distribution of electricity and given the benefit of the exemp....
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....pply. Another question is whether Section 66F(3) of the Finance Act would cover cases where the single service which gives such bundle its essential character is placed in the negative list and Section 8 of CGST/SGST Acts would cover the cases of composite supply where exemption from service tax has been granted in respect of the principal supply. 17. Section 66F of the Finance Act lays down the principles of interpretation of specified descriptions of services or bundled services and reads thus :- "66F. Principles of interpretation of specified descriptions of services or bundled services. - (1) Unless otherwise specified, reference to a service (herein referred to as main service) shall not include reference to a service which is used for providing main service. Illustration. - The services by the Reserve Bank of India, being the main service within the meaning of clause (b) of Section 66-D, does not include any agency service provided or agreed to be provided by any bank to the Reserved Bank of India. Such agency service, being input service, used by the Reserve Bank of India for providing to main service, for which the consideration by way of fee or c....
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....e to tax, Section 66F would not apply to services falling in the negative list and, consequently, the benefit of bundling under Section 66F(3) would not be available. 19. Sub-section (3) of Section 66F of the Finance Act provides for the manner in which a bundled service is to be determined. Clause (a) thereof, which is relevant for the present purpose provides that if various elements of such service are naturally bundled in the ordinary course of business, it shall be treated as provision of the single service which gives such bundle its essential character. The explanation thereof defines "bundled service" to mean a bundle of provision of various services wherein an element of provision of one service is combined with an element or elements of provision of any other service or services. 20. The facts of this case are required to be examined in the light of the above statutory provisions. In this case, we are concerned with transmission and distribution of electricity being the main services and application fee for releasing the connection for electricity; rental charges against metering equipment; testing fee for meters/transformers, capacitors etc.; labour cha....
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.... (3) If a distribution licensee fails to supply the electricity within the period specified in sub-section (1), he shall be liable to a penalty which may extend to one thousand rupees for each day of default. 45. Power to recover charges. - (1) Subject to the provisions of this section, the prices to be charged by a distribution licensee for the supply of electricity by him in pursuance of section 43 shall be in accordance with such tariffs fixed from time to time and conditions of his licence. (2) The charges for electricity supplied by a distribution licensee shall be - (a) fixed in accordance with the methods and the principles as may be specified by the concerned State Commission; (b) published in such manner so as to give adequate publicity for such charges and prices. (3) The charges for electricity supplied by a distribution licensee may include - (a) a fixed charge in addition to the charge for the actual electricity supplied; (b) a rent or other charges in respect of any electric meter or electrical plant provided by the distribution licensee. (4) Subject to the provisions of section 62, in fixing c....
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....city, except for electric meter and any electrical equipment, apparatus or appliance under the control of a consumer fall within the ambit of electrical plant as defined under Section 2(22) of the Electricity Act. Sub-section (2) of Section 43 of the Electricity Act casts a duty upon the licensee to provide if required electric plant or electric line for giving electric supply to the premises. Therefore, providing electric line and electric plant are elements of service which are naturally bundled in the ordinary course of business, with the single service of transmission and distribution of electricity which gives the bundle its essential character. The only related service which does not fall within the ambit of the definitions of electric line and electric plant is the meter used for ascertaining the quantity of electricity supplied to any premises. However, insofar as installation of electricity meter and hire charges collected in respect of electricity meters are concerned, by the circular dated 7th December, 2010, the Government of India has clarified that supply of electricity meters for hire to the consumers is an essential activity having direct and close nexus with transm....
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.... of a bundled service has to be determined in the manner provided under sub-section (3) of Section 66F of the Finance Act. If the services are naturally bundled in the ordinary course of business, the bundle of services shall be treated as provision of the single service which gives the bundle its essential character and where the services are not naturally bundled in the ordinary course of business, the same is required to be treated as provision of the single service which results in highest liability of service tax. Accordingly, where the services are naturally bundled in the ordinary course of business and the single service which gives such bundle its essential character is exempt from tax, the entire bundle will have to be treated as provision of such single service. 25. Thus, insofar as the phase relating to the negative list regime is concerned, the services in question would fall within the ambit of bundled services as contemplated under sub-section (3) of Section 66F of the Finance Act, and would have to be treated in the same manner as the service which gives the bundle its essential character, namely, transmission and distribution of electricity and, would ther....
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....posite supply is required to be determined by treating the same as a supply of the principal supply namely, transmission and distribution of electricity. 27. It has been contended on behalf of the respondents that clause (a) of Section 8 of the CGST Act would not be applicable where the principal supply is exempt from levy of service tax. In the opinion of this Court, there is nothing in Section 8 of the Act to read any such construction. What the section says is that the tax liability of a composite or a mixed supply shall be determined in the manner provided thereunder. In a given case, the tax liability may be nil, but that would not take such service out of the purview of Section 8 of the Act, which would be attracted if the supply is either composite or mixed in nature, notwithstanding that the end result may be nil tax liability. 28. While on behalf of the petitioners it has been contended that the services rendered by them are in the nature of composite supply, on behalf of the respondents it has been contended that the same are in the nature of mixed supply within the meaning of such expression as contemplated in Section 2(74) of the CGST Act and would, th....
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....ansmission and distribution of electricity is exempt from levy of service tax, the tax liability of the related services shall be determined accordingly. 29. TO SUMMARISE : - The preliminary contention regarding the petition not being maintainable is rejected. - As per the circular dated 7th December, 2010, the reason for saying that supply of electricity meters for hire to consumers is covered by the exemption notification is that such service is an essential activity having direct and close nexus with transmission and distribution of electricity. This circular only provides an interpretation of when a service would stand included in another service, namely, when such service is an essential activity having direct and close nexus with the exempted activity. Therefore, the fact that the exemption notifications came to be rescinded has no relevance inasmuch as all that the circular clarifies is what according to the Government of India would stand included in another service. Such interpretation would not change merely because such exemption is now granted under some other provision. - The meaning of "transmission and distribution of electricity" ....
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....nment of India has clarified that supply of electricity meters for hire to the consumers is an essential activity having direct and close nexus with transmission and distribution of electricity, and, therefore, is covered by the exemption for transmission and distribution of electricity extended under the relevant notifications. Therefore, all the services related to transmission and distribution of electricity are naturally bundled in the ordinary course of business of the petitioner and are required to be treated as provision of the single service of transmission and distribution of electricity which gives the bundle its essential character. - The term "taxability" means liability to taxation. Thus, the term taxability would take within its sweep not being taxable also inasmuch as liability to taxation would also mean not being liable to any tax. Thus, the liability to tax of a bundled service has to be determined in the manner provided under sub-section (3) of Section 66F of the Finance Act. If the services are naturally bundled in the ordinary course of business, the bundle of services shall be treated as provision of the single service which gives the bundle its essen....
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.... Testing fee for meters/transformers, capacitors etc.; iv. Labour charges from customers for shifting meters or shifting of service lines; v. charges for duplicate bill; provided by DISCOMS to consumer are taxable. The impugned summons dated 28-3-2018 is hereby set aside to the extent the petitioners are called upon to produce the documents listed at Serial No. 5 of the annexure thereto, except clause (vi); income from shifting of HT lines received from MEGA. Consequently, the respondents shall drop the proceedings under the Finance Act, 1994 as well as under the CGST/SGST Acts sought to be initiated by virtue of the impugned summons to the extent the same is based upon Item No. 4(1) of the impugned circular dated 1st March, 2018. 31. Rule is made absolute to the aforesaid extent with no order as to costs. 32. At this stage, Learned Standing Counsel for the respondents has requested that the operation of this judgment be stayed for a period of eight weeks so as to enable the respondents to approach the higher forum. The request is considered and declined." (b) In the case of Hyderabad Power Installations (supra), the following vie....
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..... Prima facie, I find that appellant is eligible for the benefit of Notification and therefore the appeal could have been heard without insisting on pre-deposit. Accordingly, the impugned order is set aside and the matter is remanded to the Commissioner (A) with a request to hear the appeal without insisting on any pre-deposit. 5. Similar view has been accorded in the other cited judgments also. Applying the dictum laid in the above judgments we find that the demand raised under ECIS is unsustainable and requires to be set aside which we hereby do. We do not interfere with the demand in regard to renting of Immovable Property. The appeal partly allowed with consequential reliefs, if any. (c) In the case of Hyderabad Power Installations (P) Limited the following order was passed:- 6. We find that the contentions of the appellant are not without merits. In the first place itself, we find from the records that the issue of taxability of services provided by service providers such as the appellant in categories like "Erection, Commissioning or Installation Services" was in dispute and the department had contended that such services will not fall under the ben....
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....ransmission and distribution of electricity provided by a person (hereinafter called the service provider) to any other person (hereinafter called 'the service receiver'), and that all such services were liable to service tax under the said Finance Act, which were not being levied according to the said practice during the period up to 26th day of February, 2010 for all services relating to transmission of electricity, and the period up to 21st day of June, 2010 for all taxable services relating to distribution of electricity. Now, therefore, in exercise of the powers conferred by section 11C of the Central Excise Act, 1944 (1 of 1944), read with section 83 of the said Finance Act, the Central Government hereby directs that the service tax payable on said taxable services relating to transmission and distribution of electricity provided by the service provider to the service receiver, which was not being levied in accordance with the said practice, shall not be required to be paid in respect of the said taxable services relating to transmission and distribution of electricity during the aforesaid period". 9. It is thus seen that the subsequent notification clearly ....
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....D] * Kedar Construction v. CCE, Kolhapur [2015 (37) S.T.R. 631 (Tri.-Mumbai] * UP Rajkiya Nirman Nigam Ltd. v. CCE, Meerut [2015-TIOL-1485-CESTAT-DEL] * Elmech Enterprises v. CCE, Hyderabad-III [2015-TIOL-459-CESTAT-BANG] 4. We find that the appeal before us is more than amply covered by the above judgments. The relevant portion of the judgment in Elmech Enterprises case is reproduced below : 5. The Notification No. 45/2010-S.T. provides exemption to all taxable services relating to transmission and distribution of electricity by a person to another person during the relevant period covered by the proceedings. It is not limited only to taxable service of transmission by the transmission company as observed by the learned original adjudicating authority. Prima facie, I find that appellant is eligible for the benefit of Notification and therefore the appeal could have been heard without insisting on pre-deposit. Accordingly, the impugned order is set aside and the matter is remanded to the Commissioner (A) with a request to hear the appeal without insisting on any pre-deposit. 5. Similar view has been accorded in the oth....
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....th the apparently conflicting provisions in Section 11B vis-à-vis 11C ibid, with regard to time limit prescribed to file refund claim are in fact harmonious with each other. Each has its own place, purpose and intention in the statute. The time limit of six months provided in Section 11C will normally be applicable in respect of refund claims emanating out of notifications issued under that section. However, if the issue involved in such 11C notification is also sub judice in any Court etc., the said provision of Section 11C will stand eclipsed by the general provision of Section 11B. The general provision of S. 11B(5)(ec) will then take precedence over the special provision in S. 11C ibid. In such a case, by implication the refund claimant will legally become entitled to file the claim within a time limit of one year from the date of judgment, decree, order or direction of appellate authority, Tribunal or Court in view of clause (ec) of Explanation B of S. 11B(5) ibid. 13. In the circumstances, we are of the considered opinion that the limitation can therefore start clicking only from the date of final judgment/decree/decision of Court/Tribunal/Appellate Authority.....
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....electricity is exempted. It is also clear from aforesaid decision that all services related to transmission and distribution of electricity are bundled services, as contemplated under section 65F(3) of the Finance Act, and are required 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 Company Ltd decided on 12-4-2022 and after referring to the decision of the Tribunal in M/s South Eastern Cool Fields v. Commissioner of Central Excise and Service Tax, Raipur [ST/50667/2019, decided by S....
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....mission or distribution utility". There is no dispute with regard to taxability on power charges paid by the consumers, as it is exempted under the Negative List Entry. The only dispute in the instant case is with regard to various other charges recovered from electricity consumers for supply of electricity. 20. The late payment surcharge, meter rent and supervision charges are collected by the appellant in terms of Madhya Pradesh Electricity Regulatory Commission (Recovery of Expenses and Other Charges for Providing Electric Line or Plant used for purpose of giving supply) Regulations, 2009 [M.P 2009 Regulations]. 21. The period of dispute is from July, 2012 upto March, 2017. Section 66D of the Finance Act provides for a negative list of services. This negative list comprises, amongst others, in sub-clause (k), "transmission or distribution of electricity by an electricity transmission or distribution utility". The issue involved in this appeal is not regarding the amount collected by the appellant for supply of electricity; the dispute is regarding the amount collected towards late payment surcharge, meter rent and supervision charges. 22. These three c....
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....t service tax was not required to be paid on activities relating to transmission and distribution of electricity. A Trade Notice dated July 20, 2010 was then issued by the Government of India providing that service tax shall not be required to be paid for the period prior to the issuance of the aforesaid two notifications on the services relating to transmission and distribution of electricity. 25. A question, however, arose as to whether the exemption granted for transmission and distribution of electricity would also include directly connected activities such as meter rents. The Government of India issued a Circular dated December 07, 2010 clarifying that supply of electricity meters to the consumers was an essential activity having direct and close nexus with transmission and distribution of electricity and was, therefore, covered by the exemption granted to transmission and distribution of electricity. 25.1 Thereafter, the negative list regime was introduced with effect from July 01, 2012. As noticed above, section 66D(k) includes "transmission or distribution of electricity by electricity transmission or distribution utility in the negative list". 26....
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....red services related to transmission and distribution of electricity as exempted from service tax by virtue of those notifications. Insofar as electricity meters are concerned, vide circular No. 131/13/2010-ST dated 7.12.2010, it was clarified that supply of electricity meters for hire to consumers being an essential activity, having direct and close nexus with transmission and distribution of electricity, the same is covered by the exemption for transmission and distribution of electricity extended under relevant notifications. 13. Thus, the reason for saying that supply of electricity meters for hire to consumers is covered by the exemption notification is that such service is an essential activity having direct and close nexus with transmission and distribution of electricity. This circular only provides an interpretation of when a service would stand included in another service, namely, when such service is an essential activity having direct and close nexus with the exempted activity. Therefore, the fact that the exemption notifications came to be rescinded would have no bearing inasmuch as the circular only clarifies what according to the Government of India wou....
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....ribution of electricity" does not change either for the negative list regime or the GST regime. If that be so, the services which stood included within the ambit of transmission and distribution of electricity during the pre-negative list regime cannot now be sought be excluded by merely issuing a clarificatory circular, that too, with retrospective effect. By the clarificatory circular, the respondents seek to give a different interpretation of the very same services as against the clarification issued for the prenegative list regime. 15. Thus, from the very manner in which the respondents have treated the services related to transmission and distribution of electricity during the pre-negative list regime, such services would stand covered by the exemption granted to transmission and distribution of electricity by virtue of inclusion of such services in the list of negative services under section 66D (k) of the Finance Act as well as by virtue of exemption notification issued under the CGST Act." (emphasis supplied) 27. The Gujarat High Court also examined whether services provided with fall within the ambit of bundle services as contemplated under Secti....
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.... supply to the premises. Therefore, providing electric line and electric plant are elements of service which are naturally bundled in the ordinary course of business, with the single service of transmission and distribution of electricity which gives the bundle its essential character. The only related service which does not fall within the ambit of the definitions of electric line and electric plant is the meter used for ascertaining the quantity of electricity supplied to any premises. However, insofar as installation of electricity meter and hire charges collected in respect of electricity meters are concerned, by the circular dated 7th December, 2010, the Government of India has clarified that supply of electricity meters for hire to the consumers is an essential activity having direct and close nexus with transmission and distribution of electricity and therefore, is covered by the exemption for transmission and distribution of electricity extended under the relevant notifications. Evidently therefore, all the services related to transmission and distribution of electricity are naturally bundled in the ordinary course of business of the petitioner and are required to be treate....
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....ns stated above, it is not possible to sustain the levy of service tax on the amount collected by the appellant for late payment surcharge, meter rent and supervision charges. 30. The issue that now remains to be decided is about the levy of penalty on the lease rent collected from the customers. The appellant claims that since it has deposited the lease rent, the levy of penalty may be set aside. It is not possible to accept this contention of the learned counsel for the appellant. The imposition of penalty under 'lease rent' is, therefore, confirmed. 31. Thus, for all the reasons stated above, the confirmation of demand by the Principal Commissioner on late payment surcharge, meter rent and supervision charges are set aside. The levy of penalty on the lease rent amount is confirmed. The appeal is, therefore, allowed to the extent indicated above." (f) In the case of Tamilnadu Generation and Distribution Corpn Ltd (supra), the Chennai Bench of the Tribunal passed the following order:- "5. We have carefully gone through the appeal and heard the rival contentions. The issue as per Revenue pertains to the non-payment of service tax towards services....
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....le services relating to transmission and distribution of electricity during the aforesaid period. The Apex Court in M/S. Peekay Re-Rolling Mills (P) vs The Assistant Commissioner &Anr [Appeal (civil) 2653 of 2006/ 2007 (219) E.L.T. 3 (S.C.)] held: "In our opinion, exemption can only operate when there has been a valid levy, for if there was no levy at all, there would be nothing to exempt. . . . . exemption does negate a levy of tax altogether. Despite an exemption, the liability to tax remains unaffected, only the subsequent requirement of payment of tax to fulfill the liability is done away with." Hence transmission and distribution of electricity are taxable services that have been exempted from service tax. The question is whether the activities sought to be subject to service tax levy by the impugned orders viz. 'Business Auxiliary Service', 'Consulting Engineering Service', 'Renting of Immovable Property Service' and 'Commercial Training or Coaching Service' are activities used 'for transmission' of electricity or 'for distribution' of electricity, so as to be also eligible for the said exemptions. 7. The appellant has also provided a table that 'te....
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....s having a direct and close nexus with transmission and distribution of electricity. If so, all these services would be eligible for the exemption otherwise not. 8. We may now examine the judicial precedents in the matter. The impugned order and the submissions made during the hearing by Revenue has not relied on any judgments of superior courts. The appellant has relied on the following judgements presented in a tabular form. CITATION FACTS DECISION Kedar Constructions v. CCE 2014 (11) TMI 336-CESTAT MUMBAI 5. We notice that out of the total demand confirmed of Rs. 2,04,14,368/- bulk of the demand of Rs. 1,90,47,124/- pertains to Commercial or Industrial Construction service rendered to Maharashtra State Electricity Transmission Co. Ltd., Maharashtra State Electricity Distribution Co. Ltd., Sunil Hi-Tech, Suraj Constructions, V.B. Bhike, etc. for transmission of electricity. Vide Notification 45/10-ST, all taxable services rendered 'in relation to' transmission and distribution of electricity have been exempted from the purview of service tax. The expression 'relating to' is very wide in its amplitude and scope as held by the Hon'ble Ape....
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....ission and distribution of electricity, during the period upto 26/02/2010. As consequence of this immunity Notification, the service tax liability of the petitioner for the several taxable services provided to electricity distribution companies of Andhra Pradesh during 01/04/2004 to 30/11/2009, stands eclipsed Paschimanchal Vidyut Vitran Nigam Ltd. v. CCE 2012 (8) TMI 688 CESTAT NEW DELHI ... apart from transmission of electricity, the appellant assessee was also engaged in the business of "erection, commissioning and installation" as also "technical testing and analysis" which according to the department, were subject to levy of service tax ... 14. ... any activity or service like erection, commissioning and installation of meters as also technical testing and analysis can easily be termed as the service relating to the transmission and distribution of electricity provided by the service provider to the service receiver. Thus, in our considered view such service, which is subject matter of this appeal, would be squarely covered under the exemption. Noida Power Company Ltd. v CCE 2013 (8) TMI 746 - CESTAT NEW DELHI The network involves installation, erection, commiss....
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.... Vs CC, CEx, & ST, Guntur 2015 (40) STR 267 (Tri.Bang.) Demand - Service Tax - Manpower Supply Service - Transmission and distribution of electricity - Exemption Notification No. 45/2010-S.T., eligibility - Appellant providing manpower supply services to a company exclusively engaged in providing transmission and distribution of electricity - Impugned notification exempting all services provided in relation to transmission and distribution of electricity, services provided by appellant fully exempt - Denial of exemption on ground that service was provided prior to transmission and distribution of electricity, not tenable - Nothing in impugned notification to hold so - Demand not sustainable. [paras 2, 3] Hyderabad Power Installations (P) Ltd. Vs CCCE, C. & ST., Hyderabad II 2016(45) STR 217 (Try.Hyd.) Erection, Commissioning or Installation Services (ECIS) - Service Tax - Notification No. 45/2010-S.T., dated 20-7-2010 clarified that no Service Tax required to be paid for all services relating to transmission of electricity upto 26-2-2010 and for all services relating to distribution of electricity upto 21-6-2010 - Hence, Service Tax not payable on Erection, ....
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....as a part of human resource development as skill upgradation is essential for providing and maintaining proper transmission and distribution of electricity. iv) Leasing land for power plant. ['Renting of Immovable Property Service']. The vacant land of the appellant was given on lease for setting up diesel engine-based power project having 4 units of 49 MW each. The land has been leased out to optimize the generation, transmission and distribution of electricity. As per the discussions at para 7 and the judgments above it is clear that all taxable services provided for the transmission and distribution of electrical energy are exempt from the liability to service tax during the impugned period. The sole purpose of the impugned activities as described above are 'for' ensuring the transmission and distribution of electricity. These services are not provided independently and are part of the appellant's statutory functions and are hence done 'for' transmission and distribution of electric power to various consumers located within the state of Tamil Nadu in terms of the provisions of the Electricity Act, 2003. Without the said services being rendered transmission and distribut....
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....easonable that the period of limitation that applies to a claim for the principal amount should also apply to the claim for interest thereon. We find no merit in the appeals and they are dismissed with costs." The Appellate Tribunal in its order in question had held that where no time limit is prescribed for demand/recovery of interest under Sections 47 and 61(3) of the Customs Act, 1962, then taking into consideration the scheme of Central Excise law and the limitation periods prescribed under different sections and rules. A reasonable period of limitation would be six months or five years, as the case may be, as provided under Section 28 of the Customs Act, 1962. Therefore, the demand for interest beyond the period of six months from clearance of goods is barred by limitation." In the case of Commissioner vs. Emco Limited (supra) Hon'ble Bombay High Court passed the following order:- "The Bombay High Court Bench comprising Hon'ble Mr. Justice J.P. Devadhar and Hon'ble Mr. Justice M.S. Sanklecha on 11-4-2012 dismissed the Central Excise Appeal (L) No. 116 of 2011 filed by Commissioner of Central Excise, Mumbai-III against the CESTAT Final Order No.&....