Applicable GST rate on Priority Sector Lending Certificates (PSLCs), Renewable Energy Certificates (RECs) and other similar scrips. - GST - States - 046/20/2018-GST

Circular No. 46/20/2018-GST No. 12-25/2018-19-EXN-GST-(575)-6490-6507 Government of Himachal Pradesh, Excise and Taxation Department To 1. The Additional/Jt. Commissioner of State Taxes and Excise, (South Zone, North Zone, Central Zone), Shimla, Palampur, Mandi, H.P. 2. The Joint Commissioner of State Taxes and Excise, Flying Squad, (Central Zone, North Zone, South Zone), Una, Palampur, Parwanoo, H.P. 3. The Dy. Commissioner of State Taxes and Excise, Shimla, Solan, BBN Baddi, Sirmour, Bilaspur, Hamirpur, Mandi. Kullu, Chamba, Kangra, Revenue Distt Nurpur and Una, H.P 4. The Asstt. Commissioner of State Taxes and Excise, Incharge Distt. Kinnour, H.P Dated Shimla-9 13th March, 2019. Madam / Sir, Subject: Applicable GST rate on Priority Sector Lending Certificates (PSLCs), Renewable Energy Certificates (RECs) and other similar scrips. Various doubts have been arisen amongst taxpayers regarding the classification and applicable GST rate on the Renewable Energy Certificates (RECs) and Priority Sector Lending Certificates (PSLCs). 2. Earlier, in response to a FAQ, it was clarified by the CBIC (vide advertisement dated 27.07.2017), that MEIS and other scrips like SEIS and IEIS are goods classified under heading 4907 and attract 12% GST, which is the general GST rate for goods falling under heading 4907. Subsequently, the duty credit scrips classifiable under 4907 were exempted from GST, while stock, share or bond certificates and similar documents of title [other than Duty Credit Scrips], classifiable under heading 4907, attract 12% GST. 3. Further, Circular No. 34/8/2018- GST (S.No.3) was issued clarifying that PSLCs are taxable as goods at a standard rate of 18 % under the residual entry S. No. 453 of Schedule III of notification No. 01/2017-State Tax (Rate). 4. As a result, there is lack of clarity on the applicable rate of GST on various scrips/ certificates like RECs, PSLCs etc. 5. The matter has been re-examined. GST rate of 18 % under the residual entry at S. No. 453 of Schedule III of notification No. 01/2017-State Tax (Rate) applies only to those goods which are not covered under any other entries of Schedule I, II, IV, V, or VI of the notification. In other words, if any goods are covered under any of the entries of Schedule I, II, IV, V, or VI, the GST rate applicable on them will be decided accordingly, without resorting to the residual entry 453 of Schedule III. 6. As such, various certificates like RECs, PSLCs etc are classified under heading 4907 and will accordingly attract GST @ 12 %, though duty paying scrips classifiable under the same heading will attract Nil GST{under S.No. 122A of Notification No. 2/2017-State Tax (Rate) dated 30.06.2017, as amended vide Notification No. 35/2017-State Tax (Rate) dated 15.11.2017}. 7. Accordingly, in modification of S.No. 3 of Circular No. 34/8/2018- GST, it is hereby clarified that Renewable Energy Certificates (RECs) and Priority Sector Lending Certificates (PSLCs) and other similar documents are classifiable under heading 4907 and attract 12% GST. The duty credit scrips, however, attract Nil GST under S.No. 122A of Notification No. 2/2017-State Tax (Rate) dated 30.06.2017. 8. This circular shall come into force w.e.f. 06.06.2018. 9. If any difficulty is faced, the same should be brought to the notice of this office immediately. (Rajeev Sharma, IAS) Commissioner of State Taxes and Excise, Himachal Pradesh