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2021 (8) TMI 141 - AAR - GSTInput Tax Credit - inputs/capital goods/input services - items used in Design, Engineering, Supply, Execution (EPC) of 265KW Roof top Grid Solar PV Power Plant as per MNRE 8v IEC Standards - credit for inputs and services for running the solar plant - HELD THAT:- The applicant is admittedly engaged in the manufacture of goods. Electric Energy is classified under TH No. 27160000 of the First Schedule to the Customs Tariff Act, 1975 and hence, Electric Energy is considered as goods. Accordingly, Electric power is one of the inputs required for carrying out the process of manufacturing. Further, in terms of SI.No.104 of Notification No. 02/2017(Rate) dated 28.06.2017, electrical energy is exempted from tax under CGST Act, 2017. However, in the case of the Applicant, though electric energy is fully exempted under GST, the same is going to be fully capitively consumed by the applicant for manufacture and supply of taxable goods viz. Edible oils as certified by the order issued by the Tamil Nadu Generation and Distribution Corporation Ltd. In the case at hand, the whole designing, engineering, supplying and installation have been done as works contract and as the said solar power plant being Plant and Machinery, the related Credits are not blocked under this Section - While the purchase order has been raised on M/s. KCP Solar Power Industry for Design, Engineering, supply & Execution (EPC) of 264.5 KW Roof Top Grid-Tie Solar PV Plant as per MNRE& IEC Standards using solar wedge invertor, the grouping under Gross Block Plant& Machinery and claim of credit on the goods/services grouped under such plant and machinery is not substantiated thus not satisfying explanation under Section 17 (5). As the entire set up of the solar power plant is vested with M/s. KCP Solar Industry, and has been installed by them, the work executed under Invoice invoice no 135/20-21 dated 10.9.2020 alone qualifies as Plant& Machinery and the credit of GST paid in the said invoice amounting to ₹ 8,47,458/- is alone not blocked under this section and hence available as credit. The applicant has entered into works contract for design, engineering and installation along with supply of solar power panel for an agreed consideration of ₹ 1,03,69,458/- which includes the tax of ₹ 8,47,458/. They have procured the said product for use in their business and they have also stated that the entire amount excluding the GST component has been capitalised thereby deprecation on the GST element has not been claimed for which they have produced documentary evidences - the applicant is eligible for availing input tax credit as inputs/capital goods or input services of the items used in Design, Engineering, Supply, Execution (EPC) of 265KW Roof top Grid Solar PV Power Plant as per MNRE & IEC Standards procured from M.s KCP Solar Industries as they have been found to comply with the provisions of Sections 16 (1) and (2), 17 (5) of the CGST Act,2017 and that they are found to be using the electricity so generated captively only in the process of manufacture of edible oils, which is a taxable commodity. Eligibility for input tax credit for inputs and services for running the solar plant - HELD THAT:- It is seen that they have not furnished the list of inputs and services that will be used in running the solar plant as they have done for the capital goods vide Appendix-A and elaborated it with the Fixed Assets and Work-in-progress register. They have not even attempted to substantiate their stand in this regard - ruling cannot be passed on this issue for want of valid inputs. Application disposed off.
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