NT Reporter
Panaji
Failure on the part of the Electricity Department to charge Goods and Services Tax (GST) on meter rent collected from consumers from July 1, 2017, to March 31, 2023, and non-availing of Input Tax Credit (ITC) on the purchase of electricity meters resulted in a loss of over Rs 21 crore, the Comptroller and Auditor General of India (CAG) has noted in its report.
It said that under Clause 6.11 of the Joint Electricity Regulatory Commission for the state of Goa and Union Territories Regulations, 2018, the Electricity Department is empowered to charge meter rent at the rate approved by the JERC if the meter is supplied by the department at its own cost.
The audit observed that the department charged meter rent of Rs 58.60 crore from consumers during the period from July 2017 to March 2023. However, GST at 18 per cent, amounting to Rs 10.55 crore, was not charged on the meter rent despite it being a taxable service. The GST collected on such meter rent would have enabled the department to avail ITC on the GST paid at the time of procurement of meters. The department paid GST amounting to Rs 10.63 crore on the purchase of meters during the same period.
“Thus, non-collection of GST of Rs 10.55 crore on meter rent from consumers resulted in non-payment of GST of Rs 10.55 crore and non-availing of ITC on meter purchase resulted in loss of Rs 10.63 crore to the department,” the CAG report said.
The audit also noted that the Commissioner for State Taxes (CST), Panaji, in a reply in August 2023, stated that as per the notification dated June 30, 2017, services provided by the state government are exempt from GST barring a few specified services, and that services provided by the department to unregistered entities not liable to pay GST are also exempt.
CAG, however, said that the reply of the CST is not tenable, as the Electricity Department is a deemed licensee for distribution of electricity in the state under Section 14 of the Electricity Act, 2003.
“The Electricity Department, being a deemed licensee, has been paying annual licence fee in compliance with Regulation 68 of the Joint Electricity Regulatory Commission for the state of Goa and Union Territories (Conduct of Business) Regulations, 2009. The annual licence fee paid for the year 2022-23 was Rs 3.16 crore,” it said.
