In re Sunshell Power (GST AAR West Bengal)
West Bengal Authority for Advance Ruling (AAAR) has delivered a significant ruling concerning the Goods and Services Tax (GST) implications on Engineering Procurement Construction (EPC) contracts for rooftop solar power plants. The ruling, in the case of M/s SUNSHELL POWER, provides clarity on whether such contracts constitute a composite supply, their classification, applicable GST rates, and valuation methodology.
The Case at Hand
SUNSHELL POWER, a firm engaged in the renewable energy sector, specifically in the erection, commissioning, and installation of rooftop solar power plants, sought an advance ruling. The applicant’s scope of work includes providing various components like monocrystalline panels, inverters with remote monitoring, fixing structures, and related accessories, alongside installation services. The specific contract in question involved the supply, design, installation, testing, and commissioning of grid-connected rooftop solar power plants for Indian Railways.
The key questions posed by the applicant to the AAAR were:
- Whether the supply of components of a solar power plant along with its erection constitutes a composite supply under GST.
- If so, what would be the classification and applicable GST rate.
- How the value for GST calculation would be determined.
- Whether Notification No. 24/2018 Central Tax (Rate) dated December 31, 2018, which prescribes a 70:30 ratio for goods and services, would be applicable.
Applicant’s Stance
