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TMI Blog2021 (10) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... the products Biomas Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater of the appellant are admittedly not Waste to Energy Plants in the aforesaid sense of the said phrase used in the Notification No. 1/2017-Central Tax (Rate). The products Biomas Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater of the appellant in itself do not conform to the above description of the Waste to Energy Plant submitted by the appellant inasmuch as the steam boiler is stated to be a power generation device, used for generating steam by applying the heat energy to water whereas it is stated that the coil heats the thermal oil or fluid that is pumped through the thermal oil boiler and the thermal oil heats coil in various types of heat users - In case the products of the appellant are required in the setting up of the Waste to Energy Plants , the same may still fall under aforesaid Entry at Sl. No. 234, however, neither the appellant has claimed so, nor has any evidence been brought on record in this regard. The products Biomass Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater of M/s. Isotex Corporation Pvt. Ltd. are not covered under Entry at Sl. No. 234 of Schedule I of Notification No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant has presented partial facts and remained silent on the aspect of fuel used in the product hence the GAAR referred to the official website of the appellant and observed that the nearest products that matches the description of products under consideration is 'Fluidized Bed Combustor Thermic Fluid Heater' and 'Biomass Steam Boiler'. The fuel used in above mentioned products has been specified as Imported coal, rice husk, lignite etc. and Coal, wood, briquette etc. respectively. It has been observed that the concessional Notification No. 1/2017-Central Tax (Rate) specifically applies only to the goods falling under chapters 84, 85 and 94 of the Tariff and the products under consideration attracts rate of tax of 9% CGST+ 9% SGST as applicable under Sr. No. 310 under Schedule III of Notification No. 1/2017- Central Tax (Rate) and in case of Intra -State supply, the applicable rate of tax will be 18% IGST under corresponding notification of Integrated Tax. In view of the foregoing, the GAAR passed the following ruling. (i) The Agro Waste Thermic Fluid Heaters or Boilers are classifiable under heading 8402 19 19 of the First Schedule to the Customs Tariff Act, 1975 and attract 9% CG ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional elements like Coal, Lignite etc., however that is not the case in the question raised by the appellant in the application for advance ruling. 4.4 It has been submitted by the appellant that in order to be placed under clause (e) of Entry No. 234 of Schedule I of Notification No. 1/2017-Central Tax (Rate), it is inevitable to fulfill the functionality test of 'Waste to Energy Plant'. The appellant has further submitted that it manufactures Biomass Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater, run by the use of fuel which are waste (also called as Biomass / Agro Waste) and with the use of such waste, the energy is generated; that Boiler is a closed Vessel and used for producing energy by applying combustion. 4.5 The appellant has also explained what "Waste to Energy Plant" is. 4.5 The appellant has submitted that a steam boiler is a power generation device, used for generating steam by applying the heat energy to water. It has further submitted that a thermal oil / fluid boiler fires through a helical coil and generates energy from the hot products of combustion. This, by heating the coil through radiation and convection. The coil heats the thermal oil or fluid tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ences may be referred. The appellant has referred to the meanings of the terms Waste (or wastes), Rice Husk, Groundnut Shells (Peanut Shells), Palm Kernel Shells (PKS), Sunflower Husk, Baggasse etc. The appellant has submitted that its product Biomass Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater is functioned by the use of aforesaid waste / fuel. 4.11 The appellant has submitted that the second dimension to the clause (e) of aforesaid Entry No. 234 is the word "Energy", which is not defined under law, hence dictionary meaning may be referred i.e. the capacity for vigorous activity; available power. In physics, energy is the quantitative property that must be transferred to an object in order to perform work on, or to heat, the object. In the instant case, during the process of combustion in the boiler chamber i.e. burning of biomass fuel / agro waste, both heat and steam are generated which are the form of "energy". Therefore, it has been submitted by the appellant that Agro Waste used as fuel in the combustion generates energy in the Biomass boiler. 4.12 Thereafter, the appellant has submitted that the last dimension to the clause (e) of aforesaid Entry No. 234 is the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 234(e) of Schedule I of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017, as amended and thereby eligible to Goods and Services Tax rate of 5% (CGST 2.5% + SGST 2.5%), or otherwise. 8.1 As the main issue involved in this case is regarding admissibility or otherwise of benefit of Entry at Sl. No. 234 of Schedule I of Notification No. 1/2017-Central Tax (Rate) dated 28.06.2017, as amended, to the products of the appellant, it would be useful to refer to that entry, which reads as follows :- S.No. Chapter/Heading/Sub-heading/Tariff item Description of Goods 234. 84, 85 or 94 Following renewable energy devices & parts for their manufacture (a) Bio-gas plant (b) Solar power based devices (c) Solar power generating system (d) Wind mills, Wind Operated Electricity Generator (WOEG) (e) Waste to energy plants/devices (f) Solar lantern/solar lamp (g) Ocean waves/tidal waves energy devices/plants (h) Photo voltaic cells, whether or not assembled in modules or made up into panels * 84, 85 or 94 corrected vide M.F. (D.R.) Corrigendum F. No. 354/117/2017-TRU. Pt., dated 12-7-2017 * Clause (h) inserted vide M.F. (D.R.) Corrigendum F. No. 354/117/2017TRU, da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es- The Ministry of New and Renewable Energy Sources through appropriate mechanisms shall,- (a) facilitate infrastructure creation for waste to energy plants; and (b) provide appropriate subsidy or incentives for such waste to energy plants. Thus, while the Solid Waste Management Rules, 2016 provides for particular treatment to be accorded by the Ministry of Power and the Ministry of New and Renewable Energy Sources to the "Waste to Energy Plants", it also make it clear that the phrase "Waste to Energy Plants" is used and understood to denote specific 'renewable energy plant'. 9.4 The Ministry of New and Renewable Energy (MNRE) is the nodal Ministry of the Government of India for all matters relating to new and renewable energy. Wind Power, Solar Power, Small Hydro Power, Bio Power and Waste to Energy, are among several sectors of Renewable Energy. In the Annual Report 2019-20 of the MNRE, under Chapter 4 on 'Power from other Renewables', it has been inter-alia mentioned as follows - 4.2.25 WASTE TO ENERGY 4.2.26 PROGRAMME ON ENERGY FROM URBAN, INDUSTRIAL & AGRICULTURAL WASTES/ RESIDUES i. ……. ii. ……. 4.2.27 OBJECTIVES OF THE SCHEME a. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el for generation of electricity could increase efficiency of collection and also help in more environment friendly disposal of MSW. Therefore, Waste to Energy projects could contribute significantly to the implementation of the State Action Plan on Climate Change (SAPCC) as also "Swachh Bharat Abhiyan"." Thus, the 'Gujarat Waste to Energy Policy - 2016' also refers to 'Waste to Energy Project' in a specific sense. It also refers to generation of electricity through 'Waste to Energy Projects'. 9.6 It is thus evident that the phrase "Waste to Energy Plants" denotes a particular meaning. The said phrase refers to the plants for recovery of energy in the form of Biogas / BioCNG / Electricity from agricultural, industrial and urban wastes of renewable nature such as municipal solid wastes (MSW), vegetable and other market wastes, etc. Therefore, the approach of referring to the dictionary meaning of each of the terms "Waste", "Energy" and "Plant" separately, as suggested by the appellant, would not be correct approach to understand the true meaning of the phrase "Waste to energy plants / devices" used at clause (e) of Entry at Sl. No. 234 of Schedule - I of Notification No. 1/2017-Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overed under the said clause (e) of Entry at Sl. No. 234. 10.4 In case the products of the appellant are required in the setting up of the "Waste to Energy Plants", the same may still fall under aforesaid Entry at Sl. No. 234, however, neither the appellant has claimed so, nor has any evidence been brought on record in this regard. 10.5 The issue of applicability of GST on supply of Waste to Energy Plant has also been clarified by the CBIC vide Circular No. 80/54/2018-GST dated 31.12.2018, as follows - 11.1 Representations have been received regarding applicable GST rate on the goods used in the setting up of Waste to Energy plants (WTEP) in term of Sr. No. 234 of Schedule I of Notification No. 1/2017-Central Tax (Rates), dated 28th June, 2018. The said entry 234 prescribes 5% rate on the following renewable energy devices & parts for their manufacture : (a) to (h) …… 11.2 The notification specifically applies only the goods falling under chapters 84, 85 and 94 of the Tariff. Therefore, this concession would be available only to such machinery, equipment etc., which fall under Chapter 84, 85 and 94 and used in the initial setting up of renewable energy plants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the said Entry at Sl. No. 234. 11.2 Sl. No. 332 of Notification No. 12/2012-Central Excise dated 17.03.2012 covered "Non-conventional energy devices or systems specified in List 8" and Sl. No. 16 of List 8 of the said Notification covered "Agricultural, forestry, agro industrial, industrial, industrial, municipal and urban waste conversion device producing energy". It is, thus evident that the entry at Sl. No. 332 read with Sl. No. 16 of List 8 of Notification No. 12/2012-Central Excise dated 17.03.2012 are not pari materia with Entry at Sl. No. 234 of Schedule - I of Notification No. 1/2017Central Tax (Rate) dated 28.06.2017. Therefore, the contention of the appellant that these products were exempt from levy of Central Excise vide Sl. No. 332 read with List 8 (Sl. No. 16) of Notification No. 12/2012-Central Excise dated 17.03.2012 will not assist the case of the appellant for claiming benefit of Sl. No. 234 of Schedule - I of Notification No. 1/2017-Central Tax (Rate) for these products. 12.1 As regards the classification of the products, the GAAR has held that the Biomass Fired (Steam) Boilers, Agro Waste Thermic Fluid Heater are classifiable under Tariff Item 8402 19 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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