TaxTMI 
TaxTMI 
2024 (9) TMI 406
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....rench, compound wall, etc to Gujarat Energy Transmission Corporation Ltd (GETCO) which is directly in relation to the overall installation for transmission of electricity. The service related to transmission of electricity is exempted under Notification No. 45/2010 - ST dated 20.07.2010 and Notification No. 11/2010-ST dated 27.02.2010. Therefore, the demand is not sustainable. In support he placed reliance on the following judgments:- M/s. Kedar Constructions - 2014 (11) TMI 336 - CESTAT Mumbai Dhananjay G Kela - 2024 (5) TMI 1278 - CESTAT Ahmedabad NP Patel & Co - 2022 (11) TMI 1043 - CESTAT Ahmedabad JS Kataria, Bhumi Construction Properitor - 2022 (11) TMI 633 3. Shri Anoop Kumar Mudvel, Learned Counsel appearing on behalf of the Revenue reiterates the finding of the impugned order. 4. We have carefully considered the submission made by both sides and perused the records. We find that there is no dispute that the works contract service was provided by the appellant to M/s. GETCO and this service is exclusively for overall activity of recipient in relation to transmission of electricity. Such service has been made exempted retrospectively as well as prospectively vide N....
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....sion of electricity covered under the terms " relating to transmission" of electricity. Therefore, in the present case the works contract service for the construction of building and other work is in relation to transmission of electricity, therefore, the same is exempted under the aforesaid notifications and not liable for service tax. This issue has been considered by the Tribunal in various judgments. In the case of Kedar Construction (Supra) this tribunal passed the following order :- "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 Apex Court in Doypack Systems P. Ltd. [1998 ....
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....egory of supply of tangible goods, the appellant have collected the service tax and paid the same to the government exchequer therefore, the same is not under dispute on merit. We accordingly, maintain the service tax demand and payment thereof on supply of tangible goods i.e. renting of JCB. 4.1 As regard other services, there is no dispute that the appellant have rendered the services of construction activity for concrete foundation of power transmission lines and establishment and maintenance of site for storage of material relating to transmission tower, all these services which are in relation to setting up of transmission tower for transmission of power. The period involved in the present case is 2004-05 to 2008-09, the government has issued a notification giving it retrospective effect under notification no.45/2010-ST dated 20.07.2010 ,the notification is reproduced below:- Electricity - Exemption to all taxable services relating to transmission of electricity till 26-2-2010 and distribution of electricity till 21-6-2010 Whereas, the Central Government is satisfied that a practice was generally prevalent regarding levy of service tax (including non-levy thereof), un....
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....ation 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 Apex Court in Doypack Systems P. Ltd. - 1988 (36) E.L.T. 201 (S.C.). Therefore, all taxable services rendered in relation to transmission/distribution of electricity would be eligible for the benefit of exemption under the said Notification for the period prior to 27-2-2010. 6. As regards the demand for the period w.e.f. 27-2-2010, the said exemption is available if the taxable services are rendered for transmission of electricity. As held by the Hon"ble Apex Court in the case cited supra the expression "for" means "for the purpose of". As per the definition of transmission (given in the Electricity Act, 2003), it covers a very wide gamut of activities including sub-station and equipments. Therefore, the various activities undertaken by the appellant, though classifiable under Commercial or Industrial Construction prior to 1-6-2007 or under works contract service on or after 1-6-2007, would be eligible for the benefit of exemption as held by this Tribunal in the case of Noida Power C....
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....rity. 5. On true and fair analysis of the Exemption Notification dated 22-6-2010 and the immunity Notification dated 20-7-2010, the conclusion is compelling that all taxable services provided in relation to distribution of electrical energy are exempt from the liability to Service Tax. The expression "in relation to" is of wide import and indicates all activities having a direct and proximal nexus with distribution of electrical energy. Distribution of electricity energy cannot be effectively accomplished without installation of sub-stations, transmission towers and installation of meters to record electricity consumption for periodic billing and recovery of charges. 6. In M.P. Power Transmission Co. Ltd. v. CCE, Bhopal - 2011 (24) S.T.R. 67 (Tri.-Del.) Revenue demand of Service Tax on transmission and distribution of electricity was declared unsustainable in view of Notification No. 45/2010, dated 20-7-2010. Again in Paschimanchal Vidyut Vitran Nigam Ltd. v. CCE, Meerut - 2012-TIOL-1175-CESTAT-DEL = 2012 (28) S.T.R. 412 (Tri.-Del) after analyzing the provision of Notification No. 45/2010-S.T., dated 20-7-2010 it was held that for the purpose of billing the consumer for elect....
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....ervice 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. [Notification No. 45/2010-S.T., dated 20-7-2010]"" Thus, the service tax payable on all services relating to transmission and distribution of electricity provided by the service provider to the service recipient is not required to be paid. We have seen the related contracts entered by the appellant with M/s. UPCL. It is evident from there that the service rendered by the appellant is squarely relating to transmission and distribution of electricity and therefore in the light of the Notification No. 45/2010-S.T., dated 20-7-2010 no service tax is recoverable in respect thereof. Indeed CESTAT in the case of NOIDA Power Co. v. CCE, NOIDA [2014 (33) S.T.R. 383 (Tri.-Del.)] has beld that "the expression "in relation to" is of wide import and indicates all activities having a direct and proximate nexus with distribution of electrical energy. Distribution of electrical energy cannot be effectively accomplished without installation of sub-station, ....
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....nding for years before this Tribunal. 3. In view of the above discussion, the impugned order is set aside and the appeal is allowed with consequential relief, if any, to the appellant. The stay application also is disposed of. From the above judgments, it is settled law that all the services provided in relation to transmission of electricity are exempted under notification no.45/2010-ST therefore, in the present case also services being provided are in relation to power transmission tower, the same are exempted hence the demand is not sustainable on merit. 4.2 As regard the submission made by the appellant that the demand is also hit by limitation, we find that the appellant has acted as a sub-contractor. Earlier, there were contrary clarifications by the government that the sub-contractor is not liable to service tax when the main contractor is discharging service. Subsequently vide circular dated 23.08.2007, the C.B.E.C has taken a U-turn and withdrawn the earlier stand and clarified that the sub-contractor is liable to pay the service tax. There were contrary judgments on the issue that whether the sub-contractor is liable to service tax. Subsequently the matter was re....