  Using the spatial modulation approach, where only one transmit antenna is
active at a time, we propose two transmission schemes for two-way relay channel
using physical layer network coding with space time coding using Coordinate
Interleaved Orthogonal Designs (CIOD's). It is shown that using two
uncorrelated transmit antennas at the nodes, but using only one RF transmit
chain and space-time coding across these antennas can give a better performance
without using any extra resources and without increasing the hardware
implementation cost and complexity. In the first transmission scheme, two
antennas are used only at the relay, Adaptive Network Coding (ANC) is employed
at the relay and the relay transmits a CIOD Space Time Block Code (STBC). This
gives a better performance compared to an existing ANC scheme for two-way relay
channel which uses one antenna each at all the three nodes. It is shown that
for this scheme at high SNR the average end-to-end symbol error probability
(SEP) is upper bounded by twice the SEP of a point-to-point fading channel. In
the second transmission scheme, two transmit antennas are used at all the three
nodes, CIOD STBC's are transmitted in multiple access and broadcast phases.
This scheme provides a diversity order of two for the average end-to-end SEP
with an increased decoding complexity of $\mathcal{O}(M^3)$ for an arbitrary
signal set and $\mathcal{O}(M^2\sqrt{M})$ for square QAM signal set.
