The Punjab Authority for Advance Ruling (AAR), has while considering an application filed before it, held that 5% GST is applicable to coal rejects.
The aforesaid observation was made by the Authority when M/S Punjab State Power Corporation Ltd., a Punjab Govt. undertaking engaged in the generation, transmission and distribution of electricity, with GST registration no 03AAFCP5120Q1ZC, which is exempt from the GST Act, vide notification number 12/2017(Central Tax Rate), dated 28th June,2017(Tariff Heading 9969), filed an application before it, with regard to the taxability of coal rejects.
The questions seeking the advance ruling being as to whether coal rejects, whose invoice raised by the applicant upon washery job- worker is taxable under the GST Act as well as the Compensation Cess Act in the hands of the applicant, and if yes, as to whether the applicant is eligible to Input Tax Credit (ITC) of GST and Compensation Cess of raw coal brought from its supplier and transferred to washery job worker for cleaning, including the rate admissible proportion of Input Tax Credit, the Authority observed as follows :
“It is observed that the queries of the applicant in para 3, falls under the ambit of section 97(2) of the CGST Act, 2017 read with section 97(2) of the PGST Act, 2017. Hence, the application of the applicant is eligible for a ruling by the Punjab State Advance Ruling Authority.”
Thus, drawing its conclusion, the Authority ruled:
“Coal rejects are to be classified under HSB 2701 and are taxable at 5% GST rate”.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
