Waste-to-energy GST concession denied where thermic fluid heater used conventional fuels instead of generating energy from waste.

Agro waste thermic fluid heater or boiler goods were examined for concessional GST treatment as waste-to-energy plants or devices under Sr. No. 234 of Schedule I to Notification No. 1/2017-Central Tax (Rate). The decisive factor was whether the equipment generated energy from waste in substance; the product literature and technical descriptions instead showed use of conventional fuels such as coal, wood, briquette, rice husk and lignite. As no satisfactory material established that it functioned as a waste-to-energy device or satisfied the condition for machinery used in the initial setting up of such plants, the concessional entry was found inapplicable. The goods were classified under heading 8402 19 19, attracting the regular GST rate.

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Issues: Whether Agro Waste Thermic Fluid Heater or Boiler and its parts are classifiable as waste to energy plants/devices eligible for concessional GST under Sr. No. 234 of Schedule I to Notification No. 1/2017-Central Tax (Rate), or whether they fall under the residual tariff entry attracting the regular rate.

Analysis: The product was classified under heading 8402 as a thermic fluid heater or boiler, but eligibility for the concessional entry depended on whether it was in substance a waste-to-energy device. The decisive factor was the nature of fuel used for generation of energy. On the material placed before the Authority, the product literature and technical descriptions indicated use of conventional fuels such as coal, wood, briquette, rice husk and lignite, rather than energy generation from waste in the sense contemplated by the notification. The concession under the relevant entry was also stated to apply only to machinery, equipment and parts used in the initial setting up of renewable energy plants and devices, including waste to energy plants, and no satisfactory material established that condition.

Conclusion: The concessional entry was held inapplicable and the goods were ruled to be classifiable under heading 8402 19 19, attracting 9% CGST plus 9% SGST, or 18% IGST, as applicable.

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