Service Tax
TRT-2025-
Cestat, Chennai
Date:-22-09-23
In:-
Issue Favourable to Tax Payer ?:-
Order Date – 22 September 2023
Parties: M/s. Tamil Nadu Generation and Distribution Corporation Limited Vs Commissioner of GST & Central Excise
Facts –
- The Appellant, M/s. Tamil Nadu Generation and Distribution Corporation Limited, is a 100% Government of Tamil Nadu owned public sector undertaking.
- It was revealed during an investigation that service tax has not been paid on (i) amount collected towards processing and transfer fees from wind energy generators, (ii) Consultancy charges for preparation of field feasibility report etc.,(iii) fee from non-employees towards participation in the training / workshop, and (iv) lease rental income.
- Hence periodic Show Cause Notices were issued to the appellant for the period 2008 to 2017 demanding service tax. After due process of law, the adjudicating authorities confirmed the service tax demand along with interest and imposed penalties.
Issue –
- Whether the activities of the appellant relate to transmission and distribution of electricity and are exempted from service tax or not?
Order –
- The Tribunal observed the activities of the appellant and relying upon the various judgments found that the 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 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 distribution of electricity would be impaired.
- This being so the activities though being taxable services are covered by the exemption notifications prior to 1.7.2012, and from the said date they figure in the negative list as per Section 66D(k) of the Finance Act 1994. Hence the appeal succeeds.
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