TMI Blog2022 (8) TMI 992X X X X Extracts X X X X X X X X Extracts X X X X ..... tion to and after placing reliance upon the decision of the Tribunal in M/S KEDAR CONSTRUCTIONS VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLHAPUR [ 2014 (11) TMI 336 - CESTAT MUMBAI] conclude that since the expression relating to is very wide in its amplitude and scope, all taxable services rendered in relation to transmission/distribution of electricity would be eligible of the benefit of exemption under notification dated 20.07.2010 for the period upto 27.02.2010. The decision of the Tribunal in Kedar Construction also considered the notification dated 27.02.2010 for the period 27.02.2010 onwards and held that since the exemption is available if the taxable services are rendered for transmission of electricity, the expression for would cover a very wide gamut of activities and, therefore, the activities undertaken by the appellant would be eligible to the benefit of a notification. The appellant is, therefore, clearly entitled to the benefit of both the notifications dated 20.07.2010 and 27.02.2010 - Appeal allowed - decided in favor of appellant. - Service Tax Appeal No. 57583 of 2013 and Service Tax Appeal No. 50041 of 2014 - FINAL ORDER No. 60120-60121/2022 - Dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssued to the appellant. This was adjudicated by order dated 10.09.2013 and the proposed demand was confirmed. 5. The appellant has filed the present appeals feeling aggrieved by the orders dated 31.01.2013 and 10.09.2013. 6. Shri B.L. Narasimhan learned counsel for the appellant made the following submissions: (i) The supply contract and erection contract cannot be construed as a single contract. The different clauses of both the contracts clearly show that the parties intended to execute two separate and independent contracts for the supply of towers and erection; (ii) In any case, the service for transmission of electricity was exempted for the entire relevant period by virtue of notification dated 20.07.2010 (till the period of 26.02.2010) and notification dated 27.02.2010 (w.e.f. 27.02.2010) and, therefore, so far as the activities undertaken by the appellant are concerned, no service tax is payable as these activities are towards the erection of transmission lines; (iii) Cross fall breach clause does not make the two contracts interdependent; (iv) Inclusion of value of materials can be done only in respect of contracts for the period subsequent to 07.07.2009; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (k) KEC International Ltd. versus Commissioner of Service Tax Mumbai-VII [ 2019 (9) TMI 1531 CESTAT Mumbai ]. 9. The submissions advanced by the learned counsel for the appellant and the learned special counsel appearing for the department have been considered. 10. At this stage only the submission raised by the learned counsel for the appellant that the services provided by the appellant are exempted under the two notifications dated 20.07.2010 and 27.02.2010 is being considered. 11. Learned counsel for the appellant submitted that the service for transmission of electricity was exempted for the entire relevant period by virtue of the notification dated 20.07.2010 (till the period of 26.02.2010) and the notification dated 27.02.2010 (w.e.f. 27.02.2010) and, therefore, so far as the activities undertaken by the appellant are concerned, no service tax is payable as these activities are towards the erection of transmission lines and hence, are exempted. 12. To appreciate this submission, it would be appropriate to refer to the two notifications dated 20.07.2010 and 27.02.2010 and they are as follows: Notification No. 45/2010-ST dated 20/07/2010 Regarding l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de the taxable services of Transmission/Distribution of electricity, a number of other taxable services are used by the EDAS. These taxable services, like 'Works Contract Services' in the present case, are Input services for the EDAs which can be used by them to provide the Output services of Transmission/Distribution of electricity and the EDAs can avail CENVAT credit of ST paid on these Input services, if otherwise admissible. These Input services, which are liable to ST in the hands of other service providers (like KEC, in the present case), would not become exempted under the referred Notifications by virtue of the phrase 'relating to' used in these Notifications because this phrase expands the scope of the taxable service of Transmission/Distribution of electricity but does not completely change its nature and character by bringing entirely different and distinct taxable services within its ambit. Further, the phrase 'relating to' used in these Notifications cannot be interpreted to mean 'used to provide or 'for use by any person to provide'. 15. The relevant portion of the reply filed by the appellant to the aforesaid allegation contain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taxable services relating to transmission of electricity and distribution of electricity are classifiable under a particular category of taxable service under the provisions of Finance Act, 1994, the exemption is available under Notification No. 45/2010-ST dated 20.07.2010 and Notification No. 11/2010-ST dated 27.02.2010 if the condition is satisfied that the taxable service in question is relating to transmission of electricity and distribution of electricity. D.5 The Noticee submitted that this wide interpretation to be accorded to the interpretation of the term relating to also finds a place in the decisions of the Hon'ble Supreme Court. 16. The relevant portion of the order dated 31.03.2013 passed by the Commissioner is reproduced below: 32. KEC also contended that vide Notification No. 45/2010-ST dated 20.07.2010, the Central Government exercising its powers under Section 11C of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994 has granted exemption from service tax to all taxable services relating to transmission of electricity till 26.02.2010 and distribution of electricity till 21.06.2010. Thus as far as the period prior to 26.02.2010 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the notification dated 20.07.2010 is in connection with exemption that can be availed for the period up to 26.02.2010 and the notification dated 27.02.2010 is for the period 27.02.2010 onwards. 18. A division bench of the Tribunal in KEC International dealt with contracts with electricity distribution authorities for supply, and/or installation of transmission towers between 01.10.2004 and 31.03.2009. In paragraph 7, the division bench rejected the contention of the department that the benefit of this notification would not be available to the appellant in the following manner: 7. The impugned order did consider the plea of the noticee therein for the benefit of notification no. 45/2010-ST dated 20th July 2010 but concluded that exemption granted under section 11 C of Central Excise Act, 1944 is contingent upon non-levy due to practice in the industry and that the assessee would not fall in that category. We take notice that the appellant herein had been discharging tax, either as provider of erection, commissioning and installation agency service or as provider of commercial or industrial construction service before paying the composition rate for works contract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 1988 (36) E.L.T. 201 (S.C.). Therefore, all taxable services rendered in relation to transmission/distribution of electricity would be eligible for the benefit of exemption under the said Notification for the period prior to 27-2-2010. 21. The decision of the Tribunal in Kedar Construction also considered the notification dated 27.02.2010 for the period 27.02.2010 onwards and held that since the exemption is available if the taxable services are rendered for transmission of electricity, the expression for would cover a very wide gamut of activities and, therefore, the activities undertaken by the appellant would be eligible to the benefit of a notification, as was held by the Tribunal in Noida Power Company Limited. The relevant portion of the decision of the Tribunal in Kedar Construction on this aspect is reproduced below: 6. As regards the demand for the period w.e.f. 27-2-2010, the said exemption is available if the taxable services are rendered for transmission of electricity. As held by the Hon ble Apex Court in the case cited supra the expression for means for the purpose of . As per the definition of transmission (given in the Electricity Act, 2003), it cove ..... X X X X Extracts X X X X X X X X Extracts X X X X
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