Madras High Court stays 1,100-crore GST demand on TANTRANSCO
CHENNAI: The Madras High Court on Friday directed the GST department to defer the inquiry proceedings on the four show-cause notices on tax liability of Rs 1,100 crore issued to the Tamil Nadu Transmission Corporation (TANTRANSCO) for four financial years from 2017 to 2021.
Justice Krishnan Ramasamy issued the directions while hearing the petitions filed by TANTRANSCO challenging the notices and the inquiry proceedings.
Senior counsel P Wilson, appearing for the petitioner-firm, submitted that the power transmission system operator is engaged in transmitting generated electricity across Tamil Nadu as per The Electricity Act, 2003. These activities, prior to the GST regime, were exempted from the payment of service tax.
After the introduction of the GST regime in 2017, the GST department held an audit assessment and issued four show-cause notices for the four financial years subsequent to the introduction of GST, claiming a tax liability of Rs 1,100 crore, he said.
