In re Rashtriya Chemicals and Fertilizers Limited (GST AAR Maharashtra)
Question 1. Whether ‘Treated Water’ obtained from STP (classifiable under Chapter 2201) will be eligible for exemption from GST by virtue of SI. No. 99 of the Exemption Notification No. 02/2017- Integrated Tax (Rate) dated 28 June 2017 (as amended) as ‘Water (other than aerated, mineral, purified, distilled, medical, ionic, battery, de-mineralized and water sold in sealed container]’?
Answer:- Answered in the negative.
Question 2. Whether “Treated Water” obtained from STP [classifiable under Chapter 2201] is taxable at 18% by virtue of SI. No. 24 of Schedule – III of Notification No.01/2017-Integrarted Tax (Rate) dated 28.06.2017 (as amended) as “Waters, including natural or artificial mineral waters and aerated waters, not containing added sugar or other sweetening matter nor flavoured (other than Drinking water packed in 20 litres bottles]”?
Answer:- Answered in the Affirmative.
Read AAAR Order : STP treated water eligible for GST exemption
FULL TEXT OF THE ORDER OF AUTHORITY OF ADVANCE RULING,MAHARASHTRA
The present application has been filed under Section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and MGST Act” respectively ] by M/s. Rashtriya Chemicals and Fertilizers Limited the applicant, seeking an advance ruling in respect of the following questions.
1. Whether “Treated Water” obtained from STP (classifiable under Chapter 2201) will be eligible for exemption from GST by virtue of SI. No. 99 of the Exemption Notification No. 02/2017- Integrated Tax (Rate) dated 28 June 2017 (as amended) as “Water (other than aerated, mineral, purified, distilled, medical, ionic, battery, de-mineralized and water sold in sealed container]”? or
2. Whether “Treated Water” obtained from STP [classifiable under Chapter 2201] is taxable at 18% by virtue of SI. No. 24 of Schedule – III of Notification No. 01/2017- Integrated Tax (Rate) dated 28th June 2017 (as amended) as “Waters, including natural or artificial mineral waters and aerated waters, not containing added sugar or other sweetening matter nor flavoured (other than Drinking water packed in 20 liters bottles]”?
At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, the expression ‘GST Act’ would mean CGST Act and MGST Act.
2. FACTS AND CONTENTION – AS PER THE APPLICANT
The submissions, as reproduced verbatim, could be seen thus-
A. Statement of relevant facts having a bearing on the question (s) raised
1. RCF is engaged in the business of manufacture and sale of fertilizers and industrial chemicals to customers. RCF has two manufacturing plants located in Maharashtra – one at Trombay and the other at Thai. RCF has warehouses/ distribution network across various states in India.
2. RCF has been successfully operating one STP at its Trombay premises since January 2000. This plant uses sewage water and converts it into water fit for industrial use. This water is then used in the RCF factory for manufacture of the fertilizers. The water supplied by the STP meets about 60% of the daily process water requirement of Trombay unit. The balance process water requirement is being met by Municipal Corporation of Greater Mumbai (‘MCGM’).
RCF has set up a New Sewage Treatment Plant and it became operational on 10th September 2019 (here-in-after referred to as ‘New STP’) with an objective of becoming self-dependent in meeting daily process water requirements of Trombay unit. RCF has entered into an MOU with BPCL for supply of treated water which is suitable for use in industry. The surplus treated water from the new STP is being supplied to BPCL as per the terms and conditions of MOU as under:-
