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TMI Blog2017 (9) TMI 1386X X X X Extracts X X X X X X X X Extracts X X X X ..... are at highly subsidized rates and therefore, cannot be considered as an industry in the sense that the said word is used in the definition of taxable entry. The Board was sustaining on the grants released by the State Government. The pipelines constructed were for providing drinking water facilities to the people of the State through different Gram and Taluka Panchayats. Only a small portion of the water was provided to the industries at commercial rates - levy of tax set aside. Appeal dismissed - decided against Revenue. - Tax Appeal No. 717 of 2017 - - - Dated:- 21-9-2017 - MR. AKIL KURESHI AND MR. BIREN VAISHNAV, JJ. For The Appellant : MR ANKIT SHAH, ADVOCATE ORAL ORDER ( PER : HONOURABLE MR . JUSTICE AKI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v ) Whether CESTAT was justified in holding that all activities which are concerned with welfare of citizens are excluded from liability of Service tax? and vi ) Whether in the facts and circumstances of the case, CESTAT was justified in setting aside the Order in Original passed by the Commissioner and in allowing the appeal filed by M / s BMS Projects Pvt . Ltd . ? 2. Respondent is engaged in providing construction services, for which purpose, it is registered in the category of commercial or industrial construction service with the Central Excise Authorities. Issue pertains to levy of service tax on the service provided by the respondent in laying down long distance pipelines for transfer of drinking wat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the drinking water supply and sanitation policy and to operate and maintain the water supply schemes to develop human resources for the effective implementation of programmes among others. It was noted that GWSSB was created under statute. It was not enacted under a trade or commerce and was engaged solely in supplying potable water to supply different parts of the State. It was noted that only a small portion of the water is supplied to the industries at a higher cost. Such sale was merely incidental and ancillary to their main objective. The Tribunal noted that 90% of the water supplied by the Board was to the Gram Panchayats, Nagar Palikas and Nagar Panchayats at a non commercial rate. The Board did not have any profit motive in carryi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to (d) thereof are such which are used or to be used primarily for commercial or industry. In this context, the Tribunal noted that GWSSB was constituted under an Act for carrying out following duties and functions: ( a ) To prepare, execute, promote and finance the schemes for supply of water and for sewerage and sewage disposal; ( b ) To render all necessary services in regard to water supply and sewerage to the State Government and local bodies and on request to private institutions or individuals also; ( c ) To prepare draft State Plans for water supply, sewerage and drainage on the directions of the State Government . ( d ) To assess the requirements of materials and arrange for their procurement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly drinking water and maintenance of sewerage system. The usage charges recovered by the Board from Gram Panchayats, Nagar Palikas and Nagar Panchayats are at highly subsidized rates and therefore, cannot be considered as an industry in the sense that the said word is used in the definition of taxable entry. The Board was sustaining on the grants released by the State Government. It was therefore concluded that the pipelines were not laid to facilitate any commercial or industrial activity. 5. We are broadly in agreement with the view of the Tribunal. The Tribunal noted the purpose for which the Board was constituted and its nature of activities. The pipelines constructed were for providing drinking water facilities to the people of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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