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TMI Blog2022 (4) TMI 822X X X X Extracts X X X X X X X X Extracts X X X X ..... il Application No.5343 of 2018 before this High Court and prayed for the following reliefs: "A. This Hon'ble Court may be pleased to issue a writ striking down and declaring the clarification issued in para 4 (1) of the impugned Circular No.34/8/2018-GST dated 1.3.2018 (annexed at Annexure A) by the Government of India as ultra vires the provisions of the GST Acts as well as the notifications issued thereunder: B. This Hon'ble Court may be pleased to declare that charges such as application fee, meter rent, testing fee, etc collected by the Petitioners towards activities directly and closely connected with the transmission or distribution for electricity are exempt from tax under Entry 25 of Notification No.12/2017 dated 28.6.2017; C. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hire to consumers is covered by the exemption notification is that such service is an essential activity having direct and close nexus with transmission and distribution of electricity. This circular only provides an interpretation of when a service would stand included in another service, namely, when such service is an essential activity having direct and close nexus with the exempted activity. Therefore, the fact that the exemption notifications came to be rescinded has no relevance inasmuch as all that the circular clarifies is what according to the Government of India would stand included in another service. Such interpretation would not change merely because such exemption is now granted under some other provision. - The meaning of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cept for electric meter and any electrical equipment, apparat-us or appliance under the control of a consumer. Sub-section (2) of section 43 of the Electricity Act casts a duty upon the licensee to provide, if required, electric plant or electric line for giving electric supply to the premises. Therefore, providing electric line and electric plant are elements of service which are naturally bundled in the ordinary course of business, with the single service of transmission and distribution of electricity which gives the bundle its essential character. The only related service which does not fall within the ambit of the definitions of electric line and electric plant is the meter used for ascertaining the quantity of electricity supplied to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quired to be treated as provision of the single service which results in highest liability of service tax. Accordingly, where the services are naturally bundled in the ordinary course of business and the single service which gives such bundle its essential character is exempt from tax, the entire bundle will have to be treated as provision of such single service. - In respect of the period falling under the negative list regime, the services in question would fall within the ambit of bundled services as contemplated under sub-section (3) of section 66F of the Act, and would have to be treated in the same manner as the service which gives the bundle its essential character, namely, transmission and distribution of electricity and, would th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... large before the Supreme Court. 6. We take notice of the fact that the judgment of this High Court has not been stayed from its operation. It further appears that since the judgment delivered by this High Court is now a subject matter of challenge before the Supreme Court and the Supreme Court has granted leave to appeal, the writ applicant as of abundant caution started obtaining undertaking from the consumers as regards the service tax and GST. The writ applicant is of the view that in the event, if the Union succeeds before the Supreme Court then it will have to deduct service tax and/or GST and pay the same to the Government. One of the consumers objected to this action on the part of the writ applicant in obtaining such undertaking. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ereunder. Moreover, considering the aspect that that no other legal or other complications may arise in the future as well as to avoid the non-compliance of the order passed by the Hon'ble Gujarat High Court, the Forum believes that it is fair and reasonable for the respondent company to obtain the undertaking only without recovering the amount of GST at present." 8. The matter thereafter, was carried further by the very same complainant before the Ombudsman of the Gujarat Electricity Regulatory Commission. The Ombudsman of the Commission has passed an order dated 20.12.2021 taking the view that as the Electricity Act, 2003 does not provide or empower the company to obtain such undertaking, it is not permissible for the writ applicant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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