Torrent Power Ltd Vs Union of India & Ors (Gujarat High Court)
Gujarat High Court held that reimbursement of the service of the cost of repairing and restoration of the roads to AMC cannot be considered as a supply of service by the AMC so as to fasten the liability of the GST on reverse charge basis.
Facts- The petitioner is engaged in the business of transmission / distribution of electricity in the State of Gujarat, Maharashtra and Uttar Pradesh. Petitioner has been granted the electricity distribution license under the provisions of the Electricity Act, 2003 for distribution of electricity in Ahmedabad, Surat, Gandhinagar, Dahej SEZ and Dholera. The petitioner has franchisee for electricity distribution in different parts of Maharashtra and State of Uttar Pradesh.
The petitioner is registered under the provisions of the GST Act and is regularly filing its returns under the provisions of the said Act. During the course of routine maintenance and network enhancement so as to distribute the electricity, the petitioner is required to dig out tranches on the public road which are maintained by the municipal corporation. The dug out portion of the road and pavement is then repaired/restored by the municipal corporation.
It is the case of the petitioner that, the Ahmedabad Municipal Corporation, recovers reimbursement of the repairing / restoration charges from the petitioner which are fixed per meter / area based on the type of the road. The petitioner is statutorily entitled to dig out the road for laying or repairs or maintenance of distribution lines under the provisions of Secs.42 and 67 of the Electricity Act,2003. The respondent No.2 issued a notice on 27.08.2021 calling upon the petitioner to provide the details of the Road Opening Permit charges paid by the petitioner to the AMC as well as the GST paid on reverse charge basis on such services received from the AMC. The petitioner has, therefore, challenged the said notice.
