Air-Cooled Condenser for Waste-to-Energy Project: GST Rate 5% - Integral Part of Plant

The ruling authority classified the Air-Cooled condenser supplied for the waste-to-energy project under Heading 234 of Notification 1/2017-Central Tax (Rate), attracting a GST rate of 5% (2.5% CGST + 2.5% SGST or 5% IGST). The condenser was deemed an integral part of Waste to Energy plants/devices, as per relevant GST notifications.

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Issues:
Classification of Air-Cooled condenser supplied for waste-to-energy project under GST.

Analysis:
The applicant, a private limited company, sought clarification on whether the Air-Cooled condenser supplied for a waste-to-energy project qualifies as 'parts for the manufacture of waste to energy plants/devices' attracting 5% IGST or 2.5% CGST and 2.5% APGST. The applicant's registration details showed they fall under the jurisdiction of the Superintendent of Central Tax, Sullurpet range. The jurisdictional officer confirmed no pending or passed proceedings on the raised issues. A personal hearing was scheduled, and the authorized representative presented the case.

The applicant, engaged in designing, manufacturing, and supplying Air Cooled Condensers (ACC) for renewable energy devices, received an order for an ACC package for a waste-to-energy plant project. The waste-to-energy project involves processing Municipal solid waste (MSW) to generate steam from boilers, with the exhaust condensed in ACC. The applicant sought a ruling on the classification of the ACC system under relevant GST notifications.

The ruling authority analyzed the relevant GST notifications, specifically Notification 1/2017-Central Tax (Rate), which includes 'Waste to energy plants/devices' under Heading 234, attracting 2.5% CGST and 2.5% SGST. The ACC, falling under Heading 8404 of the Customs Tariff, is considered an integral part of Waste to Energy plants. Therefore, the ACC supplied for the waste-to-energy project is classified under Heading 234, liable at a rate of 5% (2.5% CGST + 2.5% SGST or 5% IGST). The ruling concluded that the Air-Cooled condenser is indeed part of the Waste to Energy plant, as per the relevant GST notifications.

In conclusion, the ruling determined that the Air-Cooled condenser supplied for the waste-to-energy project falls under the entry 234 of Schedule I of Notification 1/2017-Central Tax (Rate), attracting a GST rate of 5% (2.5% CGST + 2.5% SGST or 5% IGST).

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