The AAR determined that supply, design, installation, testing, ...

Solar Power Plant Installation Deemed Works Contract: 12% and 18% IGST Applied Based on Goods and Services Ratio

May 23, 2025

Case Laws GST AAR

The AAR determined that supply, design, installation, testing, and commissioning of grid-connected rooftop solar power plants constitute a composite works contract involving immovable property. The ruling established a bifurcated tax treatment: 12% IGST on 70% of the gross value (representing goods component) and 18% IGST on 30% of the gross value (representing services component). The decision hinged on the permanent nature of the solar installation, interpreting it as inseparably attached to the earth, thus qualifying as a works contract under GST regulations. The tax calculation is based on the total gross consideration charged by the supplier.

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The AAR determined that supply, design, installation, testing, ...

Solar Power Plant Installation Deemed Works Contract: 12% and 18% IGST Applied Based on Goods and Services Ratio

May 23, 2025

Case Laws GST AAR

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