(i) Solar Panel has a specific entry in the 1st schedule and the same is taxable at the rate of 5% GST; (ii) Solar Pump is a solar power based device which is covered under entry No. 234 of notfn No.1/2017-CT (R) dated 28.6.2017 and, therefore, taxable at the rate of 5%.GST;
Hence, solar pump is solar power based devise (sic. device) and is classifiable under entry No.234 of notfn No.1/2017-CT (R) dated 28.6.2017 and taxable at the rate of 5% GST. Solar Controller.– Solar Controller is technically known as a Charge controller.
Therefore, businesses engaged in Renewable Energy can claim input tax credit subject to such restrictions or reversals. The ARA held that the solar power plant has to be fastened to the rooftop of the building and would require construction/erection of pillars for the same. Hence, it is ‘permanently fastened to anything attached to the earth’.
The appellant has mainly submitted that the entries in tariff notfn for both goods and services have been amended since 1.2.2019 itself to give effect to taxability of contracts for supplies of goods with installation services in the sector of solar devices in a ratio of 70:30 with an effective rate of 8.9%.
On Solar Power Based Devices, a) 5% GST ruled on Goods, where the value of goods is to be taken as 70% of the gross consideration uptill 30.9.2021. However, the rate of tax on goods portion stands increased from 5% to 12%, w.e.f. 1.10.2021. b) 18% GST ruled on Services, where the value of Services is to be taken as 30% of the gross consideration.
All renewable energy devices are taxed at 12% GST. But, if the project includes erection, procurement, and commissioning of a solar generating system, it will fall under ‘Works Contract Services’. In this case, 12% GST will be applicable on 70% of the total contract value and 18% on the remaining 30% value.
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