Rajasthan high court held that GST should not be liable upon meter charges and the additional charges charged through Jaipur Vidyut Vitran Nigam Limited (JVVNL).
“The Rajasthan high court at Jaipur in the concern of Jaipur Vidyut Vitran Nigam Limited vs. UO I & Ors. has canceled para 4(1) of Circular dated 01/03/2018 which clarified that services supplied by DISCOMS like (i) application fee for releasing connection of electricity; (ii) Rental Charges against metering equipment; (iii) Testing fee for meters/ transformers, capacitors, etc.; (iv) Labour charges from customers for shifting of meters shifting of service lines; and (v) charges for the duplicate bill are taxable beneath GST.”
“For the concern Adv. Sanjay Jhanwar, Adv. Prakul Khurana assisted by Adv. Rahul Lakhwani and Adv. Bhanu Shree Jain from Chir Amrit Legal LLP seems on the grounds of the applicant JVVNL he debated that the union government vide Notification No.12/2017 on 28.06.20 17 exempted services of transmission distribution of electricity.”
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But the impugned circular suspended the mentioned services that are part of the principal supply of transmission and distribution of electricity. As the stated services are composite services. Hence according to section 8 of the CGST Act, the subject GST rate as liable on the major supply will be applied. As per the stated services will need to get excused.
Moreover, the reference was build to the “judgment of Hon’ble High Court of Rajasthan at Jodhpur for the concern of Jodhpur Vidyut Vitran Nigam Limited vs. UOI & Ors (CW/9397/2018, decided on 05/02/2021) and judgment of Hon’ble High Court of Gujarat for the concern of Torrent Power Ltd. vs. Union of India (SCA/5343/2018,” decided on 19/12/2018) in which para 4(1) of the challenged circular shall get removed.
The two judges Justice Sabina and Justice Chandra Kumar Songara stated that the impugned circular seeks to provide the tax net five services mentioned in that and regardless of the situation completed the bundle or package of services named as transmission and distribution of electricity by an electricity transmission or distribution utility shall get privileged. The stated effort of breaking out the services out of the full package and treating them to be taxable is not only the cause but this exercise is also violative of procurement of section 8 of the CGST act.
