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TMI Blog2024 (8) TMI 378X X X X Extracts X X X X X X X X Extracts X X X X ..... vices Tax (GST)on interstate delivery of electrical energy? - HELD THAT:- In the invoices issued by applicant to its buyer, the applicant has invoiced charges for 'supply of Electricity' only and has not collected' delivery charges' (transmission charges). Supply of Electrical Energy is exempted from Tax vide Entry at Sr. No 104 of the Notification No. 2/2017-Integrated Tax-(Rate) dated 28 th June 2017. In case the applicant is liable to pay Goods and Services Tax (GST),whether the applicant can claim and utilise the CGST and SGST paid at the instance of procurement of the solar power plant as input tax credit for payment of the GST liability? - HELD THAT:- As the output supplies of Applicant are exempted from tax, Applicant is not entitled to claim input Tax Credit on its inward supplies of goods or services or both or capital goods (procurement of the solar power plant)used in generation of Electricity as per provisions of Section 17 r.w. rules 42 and 43, which prescribe for calculation of Input Tax Credit. - SHRI AJAY KUMAR V. BONDE AND MS. PRIYA JADHAV, MEMBER PROCEEDINGS (Under Section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pril 2023 (iii) As per the agreement the applicant shall sell electrical energy up to 2MW from its above solar power plant (iv) The above agreement defines Contracted Capacity and Delivery Point as follows: -Contracted Capacity Contracted Capacity shall mean up to a maximum of 2 MW of electricity, to be arranged by the SELLER to BUYER at the Delivery Point in terms of this Agreement -Delivery Point- Delivery Point shall mean the busbar of the End Consumer i.e. Connectivity of End Consumer with DISCOM On a careful analysis of the above terms of the agreement it transpires that the scope of work for the applicant includes delivery of electricity till the busbar of the end consumer with the DISCOM.As such, the apart from production of electrical energy the applicant is also engaged in the business of transmission and distribution of electrical energy. 1.5 The electrical energy is sold by the applicant to M/s. Phillip Commodities Private Limited is in turn is sold by Philip Commodities Private Limited to M/s. Kores India Limited through the Grid Connectivity of MSEDCL M/s. Philip Commodities Private Limited is an authorised trading partner as registered with the Central Electricity Reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordingly, it transpires that the solar power plant is being utilised towards furtherance of taxable sales made by the applicant company. Hence, the input tax credit pertaining to the procurement of solar power plant can be utilised towards taxable sales of transmission and distribution of electricity to the busbar of end consumer. In support 2.4) Applicant submitted Judicial Precedents : in case of KLF Nirmal Industries (P.) Ltd. In re [2021] 129 taxmann.com 337 (AAR-TAMILNADU) The Hon'ble Bench has ruled as below: 2.5) Conclusion drawn by the Applicant. The applicant has made the above detailed analysis on the basis of which it can be concluded as follows: The applicant sells electrical energy. The transmission and distribution are not within the scope of the applicant. As the applicant sells only electrical energy there is not taxable supply in the entire transaction, whereby there is no liability towards the GST. Hence, as there is no taxable supply, the applicant is not entitled to input tax credit pertaining to the procurement of solar power plant. 3) Submission of the Jurisdictional Officer- The intra State supply of electricity generated from solar power plant by the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adma Marg, Lower Parel Mumbai, 400013 vide agreement dated 08.02.2013. M/s. Phillip Commodities Private Limited is an authorised trading partner as registered with the Central Electricity Regulatory Commission of India. (i) As per the agreement the applicant has agreed to sell electrical energy up to 2MW from its above solar power plant to the Philips Commodities. (ii) The above agreement defines contracted capacity and delivery point as follows: -contracted capacity- contracted capacity shall mean upto a maximum of 2MW of electricity, to be arranged by the SELLER to BUYER at the delivery point in terms of this Agreement -Delivery point- Delivery point shall mean the busbar of the End consumer i.e. connectivity of end consumer with DISCOM. (iii) The applicant has submitted that as per the aforesaid agreement between applicant and Philips commodities India Limited Parel Mumbai 13 the delivery point of electricity is defined as under: Delivery Point Delivery Point shall mean the busbar of the End Consumer i.e. connectivity of End consumer with DISCOM. The applicant has submitted invoices issued: TAX INVOICE Date:22.04.2024 Invoice: AES/MAR-2024 To: Philips Commodities India Pvt Ltd 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4,270/-consumed by Kores (India) ltd units received from generating company AES Engineering Solar India Pvt Ltd to the generating station described as under:- MAHARASHTRA STATE ELECTRICITY DISTRIBUTION COMPANY LTD. OPEN ACCESS METER CONSUMPTION REPROT FOR THE MONTH MARCH-2024 Consumer No. 176099030420 Consumer Name M/s. Kores (India Ltd Chakan Foundry) Serial Number 23001435 Meter Data Source Meter Generation Type SOLAR Generating Company M/s. AES Engineering Solar Pvt Ltd Generating Station 33/11KV NAGANSUR SUB STATION-33KV FDR Offset Priority 1 Agreement Start Date 01.03.2024 Agreement End Date 31.03.2024 Transaction Type Short term Feeder voltage 33 OA Contract Demand 1980 Energy Purchase Agreement Yes Bulk Power Transmission Agreement (BPTA) No Interstate Open Access No. CPP/Self Use Non-Captive Injection Drawal on same feeder No Applied for Medium Term No Connected to grid Yes Single Generator with Multiple meters No Consumption Details Export Units (KWH) 3,95,632 Units for OA Adjustment (KWH) 3,95,632 Units Aft. Transmission Loss (KWH) 3,54,322 Units Aft. Distribution loss (KWH) 3,65,960 Final Units (KWH) 3,54,322 Units adjusted against OA (KWH 3,01,916 Over Injected Units (K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies., respectively. 3) Provisions of section 17-of the GST Act, provide as under, 17. Apportionment of credit and blocked credits. (1) (2) Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies. (3) The value of exempt supply under sub-section (2) shall be such as maybe prescribed, and shall include supplies on which the recipient is liable to pay tax on reverse charge basis, transactions in securities, sale of land and, subject to clause (b)of paragraph 5 of Schedule ll, sale of building. [ Explanation . For the purposes of this sub-section, the expression value of exempt supply shall not include the value of activities or transactions specified in Schedule III, except those specified in paragraph 5 of the said schedule. 4) Rule 42. Manner of determination of input tax credit in respect of inputs or input services and reversal th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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