Case Law Details
Sembcorp Energy India Ltd Vs State of Andhra Pradesh (Andhra Pradesh High Court)
Conclusion: Andhra Pradesh High Court observed that the law does not compel a man to do things which he cannot possibly perform and it was held that Rule 89 of CGST Rules, 2017, deals with a procedure for claiming refund, but requiring them to produce shipping bills, as proof of export cannot be made applicable to electricity, as it is impossible to produce shipping bill for export of electricity, since the Custom Law does not refer to electricity and shipping bill is a Customs document. Export of electricity can only be through transmission line, but not through rail, road or water, for which, necessary documents can be made available.
Facts: In present facts of the case, there was a Memorandum of Understanding for the purpose of supply of power between India and Bangladesh. The petitioner participated in the tender process floated by the Bangladesh Power Development Board and was awarded contract by BPDB. Thereafter, the petitioner entered into a Power Purchase Agreements (PPAs) with BPDB and started supplying electricity/electrical energy to BPDB in accordance with the Indian Electricity Act, 2003 and the Rules and Regulations made thereunder.
The electricity was to be supplied by the petitioner to BPDB was subjected as per the dispatch schedule provided by BPDB and then injected to the Transmission Grid at the interconnection point located in Andhra Pradesh. The injected electricity would then get transmitted from the interconnection point to Bohrompur substation, West Bengal, India, which is the ‘Delivery Point’ through an Inter-State transmission line. From the said point, the electricity would be transmitted to Bangladesh through the cross border transmission line, between Bohrompur substation, India and Bheramara substation, Bangladesh.
The Writ Petition was filed due to the said circumstances that as export of electrical energy is treated as Zero rated supply under Section 16 of IGST Act, 2017, the petitioner applied for refund of unutilized ITC in terms of Section 54 of CGST Act, 2017 read with Section 16(3) of IGST Act, 2017. But the same was rejected on the ground that as the Petitioner failed to submit shipping bill and Export General Manifest [EGM] along with refund application, evidencing delivery of electricity at Bohrompur Station, the same cannot be termed as ‘export of goods’ under Section 2(5) of the IGST Act. On 30.04.2020, the impugned order came to be passed upholding the order-in-original, rejecting the claim of refund basically on two grounds (1) The shipping bill, as required under Rule 89 (2)(b) of Central Goods and Service Tax Rules, 2017, is not submitted to the authorities and (2) There is no evidence to show that the power transmitted by the petitioner from Bohrompur Substation, Murshidabad, India is the same power which reached Bheramara substation, Bangladesh.
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