GST Applicable on shifting of Electricity Transmission Lines: AAR

The Authority for Advance Ruling(Punjab AAR) in the matter of Punjab State Transmission Corporation Limited has held that GST Applicable on shifting of Electricity Transmission Lines.

The Applicant is engaged in the business of Transmission of electricity which is exempt under GST Act, vide Notification No. 12/2017 dated 28th June, 2017 (Tariff heading 9969). Apart from above activity, PSTCL executes Deposit and Contribution works on behalf of third parties.

The Question and Ruling are as follows:

i) Under which provision / section GST is to be charged on shifting of Transmission Lines on request of NHAI (Contribution work) for widening of road, at what rate. and on which amount i.e; material, labour and supervision charges or only on supervision charges?

The services of shifting of Transmission Lines on the request of NHAI would be classified under Service Head 998631 and would attract GST @ 18 % (CGST 9% + SGST 9%). The value for purpose of levy of GST shall be the transaction value, i.e. the price actually paid or payable in terms of Section 15 of the CGST Act, 2017.

ii) Under which provision section GST is to be charged on construction and installation of sub-station transmission lines on behalf of big industries/other third parties for power supply (contribution works), at what rate and on which amount i.e; material, labour and supervision charges or only on supervision charges?

The services of construction and installation of sub-station transmission lines on behalf of big industries/ other third parties for power supply would be classified under Service Head 998631 and would attract GST@ 18 % (CGST 9% + SGST 9%). The value for purpose of levy of GST shall be the transaction value, i.e. the price actually paid or payable in terms of Section 15 of the CGST Act, 2017.

iii) Whether the PSTCL can claim Input Tax Credit on material and services used in above works (either the work done by PSTCL itself or on turnkey basis) as the property remains under the ownership of PSTCL

The applicant is eligible for claiming Input Tax Credit on the above works executed by it.

For Official Ruling Download PDF Given Below: