The Uttar Pradesh Electricity Regulatory Commission (UPERC) ordered to compensate SAEL Limited, in a petition filed seeking compensation on account of increase in its project cost due to the rise of GST rates.
The SAEL Limited is a public company that develops and manages sustainable infrastructure solutions, especially in renewable energy. The rise of GST rates in September 2021 after submitting its bid escalated its project cost. The company also raised the concern that the situation was a change in law and hence is eligible for compensation.
The company submitted its bid for the project on June 25, 2019. It signed the PPA for the project. On the other hand the Union Finance Ministry came out with a notification on September 30, 2021 which increased the GST on solar modules from 5% to 12%. “It is clear that on account of the notification dated September 30, 2021 issued by the Government of India, the petitioner incurred an additional cost of Rs 5.37 crore towards solar modules and Rs 36.55 lakh towards solar inverters. Therefore on account of the aforesaid sudden increase in the rate of GST on solar modules and solar inverters, the cost of the solar power project on the petitioner was directly affected and the petitioner incurred an additional expense of Rs 5,37,90,626,” the UPERC order said.
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