TMI Blog2020 (2) TMI 549X X X X Extracts X X X X X X X X Extracts X X X X ..... aturally bundled. The concept of the Naturally Bundled , used in Section 2(30) of the CGST Act, 2017, lays emphasis on the fact that the different element in a composite supply are integral to the overall supply and if one of the element is removed the nature of supply will be affected. In view of the clarification issued under the Circular No. 34/8/2018-GST, dated 1-3-2018, issued vide F. No. 354/17/2018, it is observed that the deposit work undertaken by the applicant are not an integral part of the supply of services of transmission or distribution of electricity and the applicant is not eligible to avail the exemption from levy of GST under Entry No. 25 of Notification 12/2017-Central Tax (Rate), dated 28-6-2017 bearing description ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stribution of electricity? (iii) Whether the exemption given under Entry No. 25 of the exemption notification for services by wav of transmission or distribution of electricity by an electricity transmission or distribution utility will be applicable on Applicant? (iv) Whether ITC is available to the applicant in undertaking Deposit Works i.e. creating infrastructure for electricity transmission? 5. The application for advance ruling was forwarded to the Jurisdictional GST Officer to offer their comments/views/verification report on the matter, which were received in the office vide Letter C. No. 01/CGST C.Ex./Div Lko-1 /Misc Corr/2018-19/2869, dated 3-7-2019. Submission of the applicant 6. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r to all the recipients which may not be appropriate for other consumers who have not used the infrastructure developed in the instant case. 6.3 The applicant collects the actual cost for undertaking the said work from the customer. Apart from this, the applicant also recovers supervision charges for executing and monitoring the entire transmission work. 6.4 Entry No. 25 of Notification No. 12/2017-Central Tax (Rate), dated 28-6-2017 exempts the services of transmission or distribution of electricity by an electricity transmission or distribution utility. The deposit work undertaken by the applicant falls within the ambit of Transmission or distribution of electricity . 6.5 Providing electric line and electric plant ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of supply of services of transmission or distribution of electricity (b) Whether the Deposit Work undertaken by Applicant is ancillary to the principal supply of transmission or distribution of electricity? (c) Whether the exemption given under Entry No. 25 of the exemption notification for services by way of transmission or distribution of electricity by an electricity transmission qr distribution utility will be applicable on Applicant? (d) Whether ITC is available to the applicant in undertaking Deposit Works i.e. creating infrastructure for electricity transmission? 9. As regard to the term composite supply, we observe that, for a supply to be consider as a composite supply, its constituent supplies sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DISCOMS against recovery of charges from consumers under State Electricity Act, it has been clarified that : Service by way of transmission or distribution of electricity by an electricity transmission or distribution utility is exempt from GST under Notification No. 12/2017-C.T. (R), Sl. No. 25. The other services such as, :- (i) Application fee for releasing connection of electricity; (ii) Rental Charges against metering equipment; (iii) Testing fee for meters/ transformers, capacitors etc; (iv) Labour charges from customers for shifting of meters or shifting of service lines; (v) Charges for duplicate bill; Provided by DISCOMS to consumer are taxable. 12. Therefore, in vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the said constructed property will qualify to be plant and machinery hence they are eligible to claim input tax credit. 14. Here we notice that Section 17 of the CGST Act, 2017, talks about the Apportionment of credit and blocked credit and as per Section 17(5) : (5) Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input tax credit shall not be available in respect of the following, namely :- .. (c) works contract services when supplied for construction of an immovable property (other than plant and machinery) except where it is an input service for further supply of works contract service; (d) goods or services or both received by a taxable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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