2025 (6) TMI 441

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....the period April, 2016 to June, 2017. The issue involved in this case is whether the service tax is liable to be paid on the supply of water by the Government of Odisha, to the appellant or not ? 2. The facts of the case are that the appellant is engaged in the manufacture of Aluminium Ingot and baked anode. During the disputed period, the applicant drew water from the Hirakud Reservoir for its industrial/commercial usage based on an agreement dated 24.01.2014 entered into with the Government of Orissa, paying the relevant water charges to the Government of Orissa at the rate of Rs. 5.60 per m3 in terms of the Orissa Irrigation Rules, 1962 which provides for a levy of license fee/cess on water drawn from government sources. 2.1 During....

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....s Tribunal in the case of M/s Indian Oil Corporation Limited (supra), wherein this Tribunal has observed as under : "24. Heard the parties. Considered the submission. 25. With regard to issue no. 1 that whether the appellant is liable to pay Service Tax on supply of water by Government of Odisha in terms of Section 66(B)A of the Finance Act, 1994 the said issue has been settled by this Tribunal in the case of M/s. Paradeep Phosphates v. Commr. Of CGST & Excise, Bhubaneswar-I, wherein this Tribunal observed as under: "In this appeal, the appellant has challenged the service tax on the water charges paid by the appellant to the Government of Odisha for supply of water against the charges in terms of the Agreement da....

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....Jabbalpur vide Final Order No.55672/2024 dated 30.04.2024. Therefore, the impugned order is to be set aside. 4. On the other hand, the Id.A.R. for the Revenue, reiterated the findings of the adjudicating authority. 5. Heard both the parties and considered the submissions. 6. We find that the issue involved in this matter is whether the appellant is liable to pay service tax in terms of Section 65B (44) of the Finance Act, 1994 under the category of "allocation/auction of natural resources" or not? The said issue has been examined by this Tribunal in the case of Sasan Power Limited (supra), wherein this Tribunal has observed as under : "16. Section 40 of the Madhya Pradesh Irrigation Act, as noticed above,....

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....tage in the water supply. This clearly means that the Agreement is for supply of water and not mere access to water source. 18. It is, therefore, more than apparent that the Agreement is for supply of water by the government to the appellant and is not for assignment of any right to the appellant to use the natural resources of the government. 19. The appellant is, therefore, justified in asserting that the Agreement executed between the appellant and the government is for supply of water for which charges are paid by the appellant on the basis of volume of water drawn and it is not a case of assignment of right to use natural resources of the government. 20. In this view of the matter no service was provided by t....