TMI Blog2023 (10) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... ts scope any activity which is rendered in connection with the main activity of transmission and distribution of electricity. While examining a similar phrase the Hon'ble Bombay High Court in the case of OIL AND NATURAL GAS CORPN. LTD. VERSUS CCE, SERVICE TAX AND CUSTOMS [ 2013 (4) TMI 103 - BOMBAY HIGH COURT] has held that - where the legislature or its delegate uses the expression in or in relation to , its object and purpose is to widen the scope and purview of its entitlement - A similar treatment has to be given to the word for in the context of the notifications. It would not suffice to examine the form of the activity sought to be classified in isolation. The guiding factor would be to examine it in conjunction with the real nature and substance of the main activity i.e transmission and distribution. It has hence to be ascertained whether the activity sought to be classified is an essential activity which is having a direct and close nexus with transmission and distribution of electricity. If so, all these services would be eligible for the exemption otherwise not. In the case of M/S S.K. SHAH VERSUS COMMISSIONER OF CENTRAL EXCISE SERVICE TAX, KOLHAPUR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 as described above 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 stated above 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. Interest - penalties - extended period of limitation - HELD THAT:- Since the issue has been decided on merits in favour of the appellant the question of paying duty, interest, penalties or of invoking the extended period does not arise. Appeal allowed. - HON BLE SHRI P. DINESHA, MEM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unts by statutory auditors on non-payment of service tax liability vide Sl. No. 8 in Notes to Accounts in Balance Sheets for the disputed period. It therefore appeared that they had suppressed relevant facts from the knowledge of the department and contravened the aforesaid provisions of law with an intention to evade payment of service tax. Hence periodic Show Cause Notices were issued to the appellant demanding service tax. After due process of law, the adjudicating authorities under the above Orders-in-Original confirmed the service tax demand along with interest and imposed penalties under various provisions of Finance Act, 1994. The show cause notice wise duty involved are tabulated below. Appeal No. Period Business Auxiliary Service Consulting Engineering Service Renting of Immovable Property Service Commercial Training or Coaching Service ST/40863/2015 2008 09 to 2011 12 87,02,278 4,71,51,927 90,27,374 56,32,229 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shram, Supdt. (AR) submitted that the contention of the appellant is not acceptable. In this regard, the Commissioner has held that the assessee, though being a Government Department should have declared the value of services and even if they are of the belief that their services are exempted they should have approached the department for clarification. Hence, the extended period has been rightly invoked in the order. She stated that the exemptions are specific to services related to transmission and distribution of electricity only and do not exempt taxable services in relation to generation of electricity or in general the services provided by an authorized transmission and distribution utility. She further reiterated the points given in the impugned orders. She prayed that the impugned orders may be sustained and appeals may be rejected. 5. We have carefully gone through the appeal and heard the rival contentions. The issue as per Revenue pertains to the non-payment of service tax towards services related to Business Auxiliary Service , Consulting Engineering Service , Renting of Immovable Property Service and Commercial Training or Coaching Service rendered by the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and distribution of electricity during the aforesaid period. The Apex Court in M/S. Peekay Re-Rolling Mills (P) vs The Assistant Commissioner Anr [Appeal (civil) 2653 of 2006/ 2007 (219) E.L.T. 3 (S.C.)] held: In our opinion, exemption can only operate when there has been a valid levy, for if there was no levy at all, there would be nothing to exempt. . . . . exemption does negate a levy of tax altogether. Despite an exemption, the liability to tax remains unaffected, only the subsequent requirement of payment of tax to fulfill the liability is done away with. Hence transmission and distribution of electricity are taxable services that have been exempted from service tax. The question is whether the activities sought to be subject to service tax levy by the impugned orders viz. Business Auxiliary Service , Consulting Engineering Service , Renting of Immovable Property Service and Commercial Training or Coaching Service are activities used for transmission of electricity or for distribution of electricity, so as to be also eligible for the said exemptions. 7. The appellant has also provided a table that tests the impugned activities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he activity sought to be classified in isolation. The guiding factor would be to examine it in conjunction with the real nature and substance of the main activity i.e transmission and distribution. It has hence to be ascertained whether the activity sought to be classified is an essential activity which is having a direct and close nexus with transmission and distribution of electricity. If so, all these services would be eligible for the exemption otherwise not. 8. We may now examine the judicial precedents in the matter. The impugned order and the submissions made during the hearing by Revenue has not relied on any judgments of superior courts. The appellant has relied on the following judgements presented in a tabular form. CITATION FACTS DECISION Kedar Constructions v. CCE 2014 (11) TMI 336-CESTAT MUMBAI 5. We notice that out of the total demand confirmed of ₹ 2,04,14,368/- bulk of the demand of ₹ 1,90,47,124/- pertains to Commercial or Industrial Construction service rendered to Maharashtra State Electricity Transmission Co. Ltd., Maharashtra State Electri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt and supply agency service', by supply of semi-skilled labour for attending to maintenance works in the sub-divisions of the distribution companies. .. by Notification No. 45/2010-ST dt. 20/07/2010, in exercise of powers conferred by Section 11 C of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994, granted immunity from the liability to remit service tax in respect of any taxable service provided in relation to transmission and distribution of electricity, during the period upto 26/02/2010. As consequence of this immunity Notification, the service tax liability of the petitioner for the several taxable services provided to electricity distribution companies of Andhra Pradesh during 01/04/2004 to 30/11/2009, stands eclipsed Paschimanchal Vidyut Vitran Nigam Ltd. v. CCE 2012 (8) TMI 688 CESTAT NEW DELHI apart from transmission of electricity, the appellant assessee was also engaged in the business of erection, commissioning and installation as also technical testing and analysis which according to the department, were subject to levy of service tax 14. any activit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,CEX ST Hydrabad III Vs Sri Rajayalakshmi Cement Products 2017 (52) STR 309 (Tri. Hyd.) Erection, Commissioning or Installation Services (ECIS) - Liability to tax - In terms of Notification No. 45/2010-S.T., all taxable services relating to transmission and distribution of electricity provided by any service provider not taxable for period up to 26-2-2010 and up to 21-6-2010 respectively for services relating to transmission and distribution of electricity - Dropping of proceedings by adjudicating authority relying on C.B.E. C. Circular No. 123/5/2010-TRU, dated 24-5-2010 proper. [para 5] MD Aub Khan Vs CC, CEx, ST, Guntur 2015 (40) STR 267 (Tri.Bang.) Demand - Service Tax - Manpower Supply Service - Transmission and distribution of electricity - Exemption Notification No. 45/2010-S.T., eligibility - Appellant providing manpower supply services to a company exclusively engaged in providing transmission and distribution of electricity - Impugned notification exempting all services provided in relation to transmission and distribution of electricity, services provided by appellant fully exempt - Denial of exemption o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The field feasibility report is prepared for the purpose of installation of wind electric generator. It is a mandatory/ statutory document and helps the appellant to monitor the role of the applicant in its capacity as an electric transmission and distribution utility. Without assessing feasibility and hereafter approving the grid tie up the appellant cannot allow the electricity generated by the WEG to enter the grid. iii) Non-employees for training/workshop. [ Commercial Coaching and Training ]. The training given to its own employees is without collecting fees. Training for others is done by collecting a nominal fee for meeting the cost of training. The training is given as a part of human resource development as skill upgradation is essential for providing and maintaining proper transmission and distribution of electricity. iv) Leasing land for power plant. [ Renting of Immovable Property Service ]. The vacant land of the appellant was given on lease for setting up diesel engine-based power project having 4 units of 49 MW each. The land has been leased out to optimize the generation, transmission and distribution of electricity. As per the discussions at para 7 and th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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