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2018 (2) TMI 1027 - AT - Service TaxWhether appellant herein engaged in operations and maintenance of power plants, as per the agreements entered with GVK industries Ltd., at various locations is liable to be taxed? - the contract is for operation and maintenance of the power plant to produce electricity and transmit it to the power grid. Appellants are challenging orders on two grounds i.e. production of electricity is manufacture of goods and that contracts cannot be vivisected and amounts are not received for maintenance and repair but for running of power plant effectively. Held that: - the amounts which are received by the appellant as consideration, are for running of the power plant and not only for maintenance and repair charges. The agreement is for operation of power plant for 24 x 7 in pursuance of such agreement, appellant prepares a detailed plan as to how to conduct maintenance of the power plant, repairs of various machinery and submits the plan to the power plant owners, in order to, give them advance intimation of the planned shutdown of the power plant - this maintenance under taken by the appellant is in order to keep the power plant in the working conditions; there is no interruption in power generation and transmission to the power grid. Similar issue came up before this Bench in the case CLP Power India Ltd., [2016 (11) TMI 645 - CESTAT MUMBAI] wherein the Bench after referring to various case laws and producing excerpts from them, concluded operation of power plant is not taxable under maintenance and repair services - decided in favor of appellant. Manufacture - whether Generation of the electricity is a manufactured product? - Held that: - the Tribunal in the case of NTPC Sail Power Co. Pvt Ltd., [2009 (5) TMI 59 - CESTAT, KOLKATA] have clearly held so and no other contrary decision is brought to our notice - decided in favor of appellant. Appeal allowed - decided in favor of appellant.
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