Page 170 - GSTL_14th May 2020_Vol 36_Part 2

272 GST LAW TIMES [ Vol. 36
terial used for such construction/erection along with supervision charges at 15%
of such actual cost thereof from the consumers. Though the cost of such construc-
tion/erection is borne by and recovered from the consumer, the Bays/Sub-
stations, Overhead Lines, etc. so constructed/erected vest in the Applicant and
are the property/assets of the Applicant, as per the GERC Regulations.
7. The applicant is engaged in business of transmission of electricity
and for providing the transmission of electricity, there is a requirement of elec-
tricity distribution infrastructure. Their consumer has option to either create the
said infrastructure on his own or alternatively the Applicant gets the same car-
ried out through EPC Contractors for the consumers. Where the consumers do
not themselves arrange to have such construction/erection or part thereof car-
ried out, the Applicant gets the same carried out through EPC Contractors for the
consumers. Here, the facilitation work done by the applicant for consumers is the
construction/erection of “Bays/Sub-Stations, Overhead Lines, Underground ca-
bles, etc. or part thereof”. Thus, the applicant constructs a dedicated transmission
line to the point of connection to enable connectivity to the grid for and on behalf
of their consumers. As per the provisions of the Electricity Act, 2003 and GERC
Regulations, the applicant recovers the actual cost of such construction/erection
along with applicable supervision charges from consumers.
8. We find that the applicant is doing a facilitation work on behalf of its
consumers for providing facilities of creating assets for and on behalf of their
consumers to enable their consumers to obtain their desired electricity in relation
to transmission of electricity. Here, the facilitation work done by the applicant for
consumers is the construction/erection of “Bays/Sub-Stations, Overhead Lines,
Underground cables, etc. or part thereof”. Thus, the applicant constructs a dedi-
cated transmission line to the point of connection to enable connectivity to the
grid for and on behalf of their consumers. As per the provisions of the Electricity
Act, 2003 and GERC Regulations, the applicant recovers the actual cost of such
construction/erection along with applicable supervision charges from consum-
ers. Thus, the applicant has supplied the services by way of construction, erec-
tion, commissioning, or installation of infrastructure for extending electricity dis-
tribution network up to the premises of the consumers for a consideration (the
actual cost of such construction/erection along with applicable supervision
charges) in the course or furtherance of business.
9. We also find that there is an exemption entry in terms of the Notifi-
cation No. 12/2017-Central Tax (Rate), dated 28-6-2017, which reads as under :

Sr. Chapter, Description of Services Rate Condi-
No. Section, (per tion
Heading, cent.)
Group or
Service Code
(Tariff)
25 Heading Transmission or distribution of Nil Nil
9969 electricity by an electricity trans-
mission or distribution utility

The above entry provides exemption from GST only to the service of “transmis-
sion and distribution by an electricity transmission or distribution utility”. The
said exemption is not available to the services provided by way of construction,
erection, commissioning, or installation of infrastructure for extending electricity
GST LAW TIMES  14th May 2020  170