Page 140 - GSTL_23rd April 2020_Vol 35_Part 4

466 GST LAW TIMES [ Vol. 35
Air and water provided by the appellant constitute less than 0.5% of the cost of
generating power whereas coal as provided by JSL constitutes more than 95% of
the cost
23. The Appellant seeks reference to a certificate issued by their cost ac-
countant - S.R. Bhargave & Co. which pertains to the financial year 2017-18. It is
re-iterated that coal constitutes the major cost for manufacture of power, whereas
air and water constitute a very negligible cost. The relevant extract to substanti-
ate the above is as follows :

cost Amount (INR in crores) % of Total
Cost of Coal 1855 95.47%
Cost of Oil 3.83 0.2%
Direct Expenses - 36.91 1.90%
Consumables Stores and Spares
Repair and Maintenance
Other Production overheads
Utility Costs
Water 7.51 0.39%
Compressed Air 1.29 0.07%
Ash Handling System 13.66 0.70%
Circulating Water Intake 16.91 0.87%
Sea Water Intake 8.20 0.42%
Power generation cost 1943 100%

24. Basis the above, the Appellant submits that coal and other inputs
constitutes a major cost i.e. more than 95% of the total cost of materials that are
required for generation of power. These are supplied by the Principal (i.e. JSL).
The cost towards water and air does not exceed 05% of the cost of inputs, which
is made available by the Job Worker (i.e. the Appellant). These charges, along
with other expenses that are required for generation of power from coal are in
any case included under the ambit of Job Work charges, chargeable by the Ap-
pellant.
25. Seeing a reference to the above, the Appellant refers to the Appel-
late Authority’s order, where, at paragraph 50, the decision of Prestige Engineer-
ing (India) Limited v. Collector of C. Excise, Meerut [1994 (73) E.LT. 497 (S.C.)], has
been referred. Further, the Ld. Appellate Authority has cited reference of a prin-
ciple enumerated therein, which is reproduced as under :
17. …………..
The Concise Oxford Dictionary assigns several meanings to the expression
‘job’ but the relevant meaning having regard to the present context is “a
piece of work especially one done for hire or profit”. The expression ‘job
work’ is assigned the following meaning : “work done and paid for the
job”. The Notification, it is evident, was conceived in the interest of small
manufacturers undertaking job-works. The idea behind the Notification
was to help the job-workers - persons who contributed mainly their labor
and skill, though done with the help of tools, gadgets or machinery, as the
case may be. The Notification was not intended to benefit those who con-
tributed their own material to the articles supplied by the customer and
manufactured different goods. We must hasten to add that addition or applica-
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