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Applicability of GST on transactions between TANGEDCO Ltd. & TANTRANSCO Ltd

Levy of GST— Applicant is seeking advance Ruling on the following:

1. GST applicability on the transactions between TANGEDCO Ltd. & TANTRANSCO Ltd

2. Applicability of GST on Deposit Contribution Works

3. Whether TANGEDCO ltd can be considered a “Government Entity”

4. Applicability of GST on Transmission Charges for Natural Gas.

Held that—
1. GST is applicable on the following as the same are ‘supply of goods’ to TANTRANSCO:

a. Supply of Operation and maintenance materials used in the regular day to day functioning; and

b. Transfer of capital Assets

2. GST is applicable on the deployment of employees to TANTRANSCO as the same is supply of Service

3. GST is not applicable on the following as the same are transaction in money:

a. Transactions of physical fund flow between the companies by the way of repayment of existing loan, availment of fresh loans, etc. on actual basis without any interest component on such fund flow.

b. Income such as transmission charges, Scheduling and Systems Operating charges, Reactive Energy Charges, etc. received from open access consumers by the applicant and adjusted through payable to TANTRANSCO.

4. The exemption under Sl.No. 25 of Notification No. 12/2017-C.T.(Rate) dated 28.06.2017 as amended is not applicable to the below stated transactions between TANGEDCO Ltd and TANTRANSCO Ltd, namely-

a. Supply of Operation and maintenance materials used in the regular day to day functioning as the same is ‘Supply of Goods’;

b. Transfer of capital Assets as the same is declared as ‘Supply of Goods’;

c. Deployment of Employee under their role and related fund flow-not a service involving distribution of electricity exempted in the said entry.—Tamil Nadu Generation And Distribution Corporation Limited, In Re… [2020] 23 TAXLOK.COM 019 (AAR-Tamil Nadu)