TORRENT POWER LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner No. 1 is the electricity company engaged in generation, transmission and supply of electricity. Admitted position is that under the earlier VAT regime, transmission and distribution of electricity by an electricity transmission or distribution utility was exempted from payment of service tax. According to the petitioners, the Government clarification dated 7-12-2010 provided that "Supply of electricity meters for hire to the 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 the relevant notifications". Thus the petitioners previously did not have to recover and pay service tax on transmission and distribution of electricity including the other incidental services provided by them.

(2.) In the new GST regime also the exemption has been provided in similar terms, as earlier, under Heading 9969 where the exemption is for the following service :

(3.) However, for the incidental or connected services, the Government of India has now issued a clarification dated 1-3-2018 in which it is provided that for all services such as application fee for releasing connection of electricity, rental charges against metering equipment, testing fee for meters, transformers, capacitors, etc., labour charges from customers for shifting of meters or shifting of service lines and charges for duplicate bill, such exemption would apply and such services are taxable.