Quashed

M/s Hero Solar Energy Pvt. Ltd., New Delhi

GST AAAR26 Apr 2019HAR/HAAAR/ 2018-19/04

Case brief

AI extract

What is this about?

This appeal challenges an advance ruling under which solar power system business was treated as a works contract. Due to subsequent amendments in GST notifications altering tax rates and composition effective January 1, 2019, the court quashed the prior ruling and directed the Authority to decide afresh.

What did the court decide?

The order dated 29.08.2018 is quashed and the applicant is directed to approach the Advance Ruling Authority for a fresh decision.

M/s Hero Solar Energy Pvt. Ltd., New Delhi — GST and Indirect Tax | GST AAAR (2019)

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BEFORE THE APPELUIIE AUTHORITY FOR ADVANCE RUTING FOR THE STATE oF HARYAN&IFOR GOODS ANp SERVTCES TAX. PANCHKULA

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Appeal case No. HAR/HAAARI 20t8-t9 I 04

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Dated z 26.04.2O19

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GSTINNumber	O6AADCHL476PTZ7
LegalNameofAppellant	M/sHero Solar Energy Pvt.Ltd.
RegisteredAddress/Address providedwhile obtaininguserlD	M/sHero SolarEnergyPvt. Ltd.,20L,First Floor,Okhla IndustrialEstate, Phase-lll,New Delhi-110020.
Appellantrepresentedb'/	Sh.AmarPratapSingh,Advocatealongwith Sh.AnkitAwal,CA.

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Order under Section 101 of the Central Goods and Services Tax Act, 2017 /the Haryana Good:; and Services Tax Act, 2017 .

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The present appeal has been filed under Section 100 (1) of the Central Goods and Services Tax Act, 2017/the Haryana Goods and Services Tax Act, 2017 [hereinafter referred to as "the CGST Act and the HGST Act respectively"] by M/s Hero Solar Enelrgy Private Limited [hereinafter referred to as the "Appellant"l against tFre Advance Ruling No. HAR/HAAR/R/201S-19/07, dated 29..08.20L8.

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A copy of order dated 29-08.2018 of the Advance Ruling Authority was received by the appellant on 05.10.2018 and the appeal has been filed on 02.L1,.2018 which is in time.

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BRIEF FACTS OF THE C,ASiE

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1.. The appellant namely M/s Hero Solar Energy Pvt. Ltd. is a Co. incorporated under thre Company's Act 1956. The appellant has proposed to enter into the business of setting up of Solar Power Generating System^(SPGS) on a turnkey basis. Thre appellant had sought advance ruling on the following questions:-

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Whether the EPC contract for complete design, engineering, manufacture, procurement, testing, Inspection, and complete erection and commissioninrg of solar power generating system will result into 'Composite Suptrlly" as defined in Section 2(30) of the Central Goods and Services Tax Act,, 2017?

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In case the supply of SPGS is treated as 'Composite Supply, whether supply of PV [t4odules/lnverters or any other supply covered under Chapter Heading 84,85 or 94 of Central Tax Notification will be treated a 'Principal Supply'?

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In case the principal supply be treated as 'supply of^P/ Modules/lnverters; or any other supply covered under Chapter Heading 84,85 or 94 of Cerrtral Tax Notification, whether the concessional rate of 5% be applicablle on the entire of value of the contract i.e. supply of SPGS?

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After notice ancl clpportunity, the Advance Ruling Authority passed the impugned order wherein the authority has held that the services of the appellant are covered under the definition of "works contract" mentioned in section 2(1L91. Being agJgrieved with the impugned order the appellant M/s Hero Solar Energy Priviate Limited has filed the present appeal.

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Pleadings:-

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Of the Appellant :

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The present appearl has been filed on the following grounds:-

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A. The impugned t,ransaction constitutes a composite supply of SPGS and Taxable @ 5%.

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B. Proposed contraclls for supply and installation of SPGS are not works contract as defined under section 2{Lt9l of CGST Act.

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C. lssue regardirng movability/immovability of property after erection/installation has been settled under the erstwhile central excise regime.

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D. lmpugned ruling; is a non-speaking order and has been passed in^gros:s violation of the principle of natural^justice.

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Record of Personal Hearing:

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Sh. Amar Pratap Singh, Advocate has reiterated the grounds taken in thr: memorandum of appeal.

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In addition, he lras given written arguments today, wherein it has been pleaded that subsequent to the decision of the Hon'ble Authority and filing of the appeal by the App,ellant, the legal position in respect of the Sr. No. 234 of the goods rate Notificartircn No. 1/20l7-Central Tax (Rate) dated 28.06.2017 ha:s changed w.e.f. 01.01,20L9 because of the amendment brought in by the Notification No. 24/2}18-Central Tax (Rate) dated 3t.I2.2018; and in respect of the Sr. No. 38 of ther service tax rate Notification No. Lt/20L7-Central Ta;r (Rate) dated 28.06.20L7 has changed w.e.f. 01-.01.2019 because of the amendment brought in by the Notification No. 27/20L$-Central Tax^(Rate) dated 3L.12.2018. Thr: litate of Haryana vide Notifications dated 3 3,.L2.20111

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il'

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has brought similar notifications in the HGST Act,20L7 as has been done^{in the} Central Goods and Sertrices Tax Act,2Otl.

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We have heard the counsel of the appellant in detail and have^perused the record of this case thoroughly.

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The advance ruling dated 2qO8.2018 obtained by the appellant is^prior to the amendments made with effect from L.OL.}OL9 by the Govt. vide notifications ibid dated 3L.I2.2OI8 under the CGST /HGST Act, 2OL7 in the respective entries. There is a change in the rate of tax and the^percentage of Goods and Services inrvolved in Solar Power Generation System^(SPGS), after Notification No. 24/20L8,- Central Tax (Rate), dated 3t.t2.2018 and Notification No.27/2A18-Central Tax (Rate) dated 3L.L2.2OI8. Therefore, after issuance of above notifications, the ltacts and circumstances have completely changed with effect from 01.01.20191.

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In the changed facts and circumstances of the case, we are of the considered view that the advance ruling granted vide Advance Ruling Order dated 2908.20L8, is no more binding on the applicant or the authorities concerned in terms of Section 103(2) of the CGST and SGST Acts and the applicant may seek Ad'vance Ruling which will be granted afresh by the Advance Ruling authority after considering the notifications mentioned in Para above and after giving opportunity of hearing to the appellant. Thus, the order dated 29.08.2018 of the Advarrce Ruling Authority is quashed and the applicant may approach the Advance Ruling Authority for taking a decision afresh in accordance with law. lt is made clear that this authority has not given any opinion on the merits of the case.

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Decided accordingly.

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Member

M/s Hero Solar Energy Pvt. Ltd., New Delhi

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M/s Hero Solar Energy Pvt. Ltd., New Delhi

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