Page 166 - GSTL_14th May 2020_Vol 36_Part 2

268 GST LAW TIMES [ Vol. 36
(B) Statement Containing the Applicant’s interpretation of Law or
Facts as the case may be in respect of the Questions on which Ad-
vance Ruling is required :
(i) The Applicant, who is a State Transmission Utility within the
meaning of Section 2(67) of the Electricity Act, 2003 read with
Section 39(1) of the said Act, supplies the Service of “Trans-
mission of Electricity”.
(ii) For the supply of the service of “Transmission of Electricity”
under “non-discriminatory open access” to consumers, con-
struction/erection of ‘Bays’/‘Sub-Stations’, ‘Overhead Lines’
and ‘Underground cables’ is required to be carried out.
Where the consumers do not themselves arrange to have such
construction/erection or part thereof carried out, the Appli-
cant gets such construction/erection carried out by Civil
Contractors who supply works contract service of construc-
tion/erection to the Applicant. The cost of such construc-
tion/erection, which is equal to the cost of labour and materi-
al and supervision charges @ 15% of cost of labour and mate-
rial, is recovered by the Applicant from the consumers. Alt-
hough the cost is recovered from the consumers, the
Bays/Sub-Stations, Overhead Lines and Cables so construct-
ed/erected vest in the Applicant and are the property/assets
of the Applicant.
(iii) In terms of Section 15(1) of the Central Goods and Services
Tax Act, 2017, the value of supply of a service shall be the
transaction value, which is the price actually paid or payable
for the supply of service when the supplier and recipient are
not related and price is the sole consideration for the supply.
Further, Section 15(2)(b) of the said Act provides that the val-
ue of supply shall include any amount that the supplier is li-
able to pay in relation to such supply but which has been in-
curred by the recipient of the supply and is not included in
the price actually paid or payable for the supply of the ser-
vice. Further, Section 15(2)(c) provides that the value of sup-
ply shall include any incidental expenses charged by the
supplier to the recipient of a supply and any amount charged
for anything done by the supplier in respect of the supply of
services at the time of, or before supply of services. Thus, the
cost of aforesaid construction/erection and other charges in-
cluding pro rata charges, supervision charges, proportionate
line charges, registration fees and operation and maintenance
charges which are incurred by the recipient of the supply of
service of Transmission of Electricity (consumer) and which
are charged by the Applicant from the consumer will form
part of the value of supply of service of “Transmission of
Electricity”.
(iv) The service of “Transmission of Electricity” by a State Trans-
mission Utility is exempt from GST, vide Sr. No. 25 of Notifi-
cation No. 12/2017-Central Tax (Rate), dated 28-6-2017 and
Sr. No. 25 of Notification No. 12/2017-State Tax (Rate), dated
GST LAW TIMES  14th May 2020  166