TMI Blog2020 (4) TMI 869X X X X Extracts X X X X X X X X Extracts X X X X ..... Distribution Company towards application fee, meter rent, other pre and post connection charges for shifting of lines, etc are covered by entry 25 of exemption notification number 12/2017-Central Tax (Rate) dated 28-06-2017 relating to transmission and distribution of electricity. Hence the same would constitute composite supply as per section 8 of the GST Act. The issue of the exemption activities carried out by the applicant with reference to administration and Pre and Post connection charges towards supply of electricity is pending before Honorable Supreme Court of India vide UNION OF INDIA AND ORS. VERSUS TORRENT POWER LTD. AND ANR. [ 2019 (8) TMI 779 - SC ORDER ] - Since the matter is sub-judice therefore advance ruling on aforesaid issue cannot be given. - KAR ADRG 22/2020 - - - Dated:- 23-4-2020 - DR. M.P. RAVI PRASAD AND SRI. MASHHOOD UR REHMAN FAROOQUI, MEMBER Represented by: Sri. B.C. Bhat, Advocate ORDER UNDER SUB-SECTION (4) OF SECTION 98 OF CENTRAL GOODS AND SERVICES TAX ACT, 2017 AND UNDER SUB-SECTION (4) OF SECTION 98 OF KARNATAKA GOODS AND SERVICES TAX ACT, 2017 1. M/s Chamundeshwari Electricity Supply Corporation Limited, No.29, CESC Corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rest amount recovered from employees Loan / Advances given to the employees for their needs. A nominal Interest is recovered Along with monthly EMI amount. (Interest is less than the Bank Interest). 7. Discount Supply of electricity by KPC to CESC is exempted if KPC has given certain Discount the same will be accounted in Books of A/c 8. Rebate Rebate received for settlement of Power purchase bills in time from the power Generator like KPCL and other Power generators. 9. Rebates collected for in time payment of energy purchase bills dues Discount given by the Power supply company for in-time payment for energy bills We purchase Electricity from Power supply Company for distribution. If the payment to the Power Supply company is made within the due date for their energy bills, the Power Supply Company will give discount/ rebate for in-time payment. 10. Income accrued on account of energy savings Due to Power savings by the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In respect of Purchase of Capital goods like Transformers, Poles, Cables etc. the depreciation accounted earlier is reversed. This is only reversal entry. 18. Write-back of Interest Interest accounted/demanded earlier if found to be accounted incorrectly, it is written back in books of accounts. This is only reversal entry. 19. Excess found on Physical verification of Materials Stock, Fixed Assets Cash During the stock verification of Stores Materials if found excess, the same will be shown in P/L A/c as Excess found on Physical Verification. The GST is Already paid at the time of purchase of Material. 20. Excess provision for IT Excess provision made in Income Tax payment at the end of year for present financial year before finalization of Company account 21. Excess provision for Depreciation in Prior periods Excess Provision made in which difference between Provision Depreciation is made with the actual depreciation accounted in Bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 31. Penalty recovered from supplier Bills Penalty recovered during payment of the suppliers bill for delay in work delay in delivery of Goods/ under performance/supply of damaged Goods / Services as per terms and condition of contract/ work award 32. Stale Cheque If amount paid through Cheque by CESC as payment is not enchased or presented to bank by the vendor/ supplier/contractors/deposit refund/ service provider within due dates the cheque is cancelled or treated as stale cheque and amount is accounted as income if the same amount is not paid to the vendor/supplier/ contractors/ deposit refund/ service provider. 33. Transformer Rent Charges collected on Lending Transformer on temporary Basis to the consumers. 34. Rental From others Rent collected for using of CESC property like store yard/Buildings/ Poles for cable connection etc., from customers. 35. Sale of Scrap Amount collected for Sale of Burnt M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Additional load Fees Fee collected for Providing additional load of power in addition to existing load as per requirements requested by the consumer as per KERC Regulations. 44. Load Reduction Fees Fee collected for Providing Reduction in load of power from the existing load as per requirements requested by the consumer as per KERC Regulations. 45. Disconnection Fee Amount collected from the consumers for disconnection of Power supply services due to non-payment of Electricity charges within stipulated time as per KERC Regulations. 46. Reconnection Fee Amount collected from the consumers for Re-connection of Power when it is disconnected. Further the amount is collected in the Power Bill itself and not collected separately from the consumers 47. Disconnection / Reconnection Fees It is the Reconnection charges collected for non-payment of electricity bills for the earlier period. It is not Fees as mentioned earlier. Further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Charges Chargers levied for shifting of Line/poles from one place to other at consumers request/ as per city requirements like widening/construction of roads etc 57. Delayed Payment Charges In case delay in payment of electricity Bill, by the consumers, delay payment charges are collected from the consumers at the rate of 1% per month calculated for the no of days delayed. Further the interest amount is added in next month Electricity Bill and collected as Electricity bill payment from the consumers 58. HT/LT Meter Testing Charge Charges collected for Technical Testing and Analysis of Meters to check the working condition of Meters like capacitors, current, reading constant etc. The testing can be made at consumer requests (at time of new connection and/or change of meter) or if complaint lodge at the time of reading of meter not working. 59. Calibration Charges Charges collected for Technical Testing and Calibration of Meters like precision of reading, and other features of Meters ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions. The amount is revised every 3 months by KERC. 67. Power Factor penalty Penalty levied if the power recorded by the capacitor is excess than standard power factor stipulate at the time of agreement for both HT and LT connection during bill cycle. The charges will be levied on the excess power recorded as Power factor penalty 68. Meter Burnt-out Cost Amount collected towards Burnt out meter (for various reasons like short circuit, overload) Pending decision Subjected to Finding fault from either party. Refund Subjected to the condition fault Found on Distribution side. If the fault is from consumer the amount account as income PRE CONNECTION- FEES/AMOUNT COLLECED FOR PRE SERVICE CONNECTION OF ELELCTRCITY RELATED SUPPLY 69. Application Fee Application Fee collected from the consumers for initial connection of Electricity supply to their premises as per KERC regulations. 70. Collection of Registration Fee on HT/LT/ Temporary Appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. The same will be refunded at the time of surrender of installation/ permanent disconnection at consumer Request 80. Meter Security Deposit Security Deposit collected as collateral for installation of LT/HT meters to consumers at the time of New connection. The same will be refunded at the time of surrender of installation/ permanent disconnection at consumer Request or when meter is returned. 81. Advance Consumption Charges Advance amount collected as collateral from the consumers for supply of Electricity of Temporary Connection . The Advance amount so collected will be refunded or adjusted towards Electricity charges at the time of conversion from temporary to permanent connection at the consumers request 82. EMD/ Security Deposits/Bank Guarantees Amount collected towards Earnest Money Deposit (EMD) / Security Deposit /Bank Guarantee for applying tender for supply of Goods/Services. The EMD/ Security Deposit /BG will be refunded after final settlement of the account or cancellation of Work Order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicant company furnishes some facts relevant to the stated activity: a. The applicant company is a limited and engaged in distribution of electricity. In turn they procure the electricity from various power suppliers such as KPTCL, KPCL, NTPC, KAOGA, JSW, PTCL, PGCIL etc. In addition to that, the applicant buys power from industries and individuals and also by the Solar Power generators. b. The Company supplies and distributes the powers to the various consumers, such as Companies, Industries, Commercial Shops, Hospitals, Farmers Irrigation pumps, Individuals, Government Organizations etc., in the Mysore, Mandya, Chamarajanagar, Hassan Kodagu Districts. The power tariff rate is fixed by the government as per the mutual understanding between ESCOMS. c. In addition to that the applicant renders other essentials services in or relation to the distribution of Electricity to consumers like application fee, Registration fee. Supervision fee, Security deposit, Meter testing charges. d. Further the applicant has stated that Intra and interstate supply of Electrical energy is goods being exempted from the payment of taxes as per entry number 104 and Chapter Heading 27 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transaction is being exempted from GST. 4. The applicant has referred to the following judgements in support of his contention: 4.1 In this regard the applicant has referred to the judgement rendered by Honourable Supreme court in the case of Doypack Systems (Pvt) Ltd. Vs. Union of India [1988 (36) ELT 201 (SC)] = 1988 (2) TMI 61 - SUPREME COURT , in which the Hon'ble Apex Court has analyzed that- Interpretation of Statute - Deeming provision - Intended to enlarge the meaning of a particular word. Deeming provision is intended to enlarge the meaning of a particular word or to include matters which otherwise may or may not fall within the main provisions. [para 64]. Interpretation of Statute - Meaning to be given to words - Construction to be adopted. - And also referred the of judgement rendered by Honourable Apex Court in the case of Oswal Agro Mills Ltd Vs. Collector of Central Excise [1993 (66) ELT 37 (SC)] = 1993 (4) TMI 73 - SUPREME COURT , the Hon'ble Apex Court has held that :- it is very clear that the statute should be interpreted in the liberal meaning. Interpretation of statute - Doctrines of reading down, Noscitur A Sociis and ejusdem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 1st March, 2018 issued by Ministry of Finance, Government of India, it was clarified that the services by way of transmission or distribution of electricity by an electricity transmission or distribution utility is only exempted as per entry number 25 of notification No. 12/2017- CT (R) dated 28.06.2017 and other services provided by the applicant to consumer are taxable as under, - 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; Circular No. 34/8/2018-GST 3 v. charges for duplicate bill; Further it is was clarified in the circular that the other services such as meter rent, application fees, testing fees for meters etc. provided by these companies to their consumers are taxable. 6.6 The same contentions was upheld by AAR Rajasthan issued ruling in the matter of M/s Tp Ajmer Distribution Limited vide RAJ/AAR/2018-19/AR-02 dated dated 11-05-2018 = 2018 (6) TMI 1196 - AUTHORITY FOR ADVANCE RULING - RAJASTHAN and relying upon the Circular ..... X X X X Extracts X X X X X X X X Extracts X X X X
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