ORDER

Brief Facts

M/s. Industrial Boiler Pvt. Ltd., the applicant submits as follows:

1. It is engaged in the business of Manufacture and supply of Agro Waste Boilers and their parts. The applicant has submitted that Agro Waste such as Husk / Straws of (Rice, Wheat, Grass, Mustard, Cotton, Sunflower etc; Bagasse / Municipal Waste / Plastic waste from paper Industry / Industrial waste / briqquete of bio mass as a fuel is used in the following Boilers-) BIOPAK, Biopak – M, Husko-DRP, Husko Boiler and Bio-Magnum to generate energy, therefore, they are to be categorised as ‘Waste to Energy Plant/ devices’.

2. The applicant submitted that CBIC vide Circular No 80/54/2018-GST has issued clarification with regard to GST rates & classification on supply of Waste to Energy Plant, which is reproduced as follows:

11. Applicability of GST on supply of Waste to Energy Plant:

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) 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/plant

(h) Photo voltaic cells, whether or not assembled in modules or made up into panels

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 and devices including WTEP. This entry does not cover goods falling under other chapters, say a transport vehicle falling under Chapter 87 that may be used for movement of waste to WTEP.

11.3 Another related doubt raised is as to how would a supplier satisfy himself that goods falling under Chapter 84, 85 and 94, say a turbine or a boiler, required in a WTEP, would be used in the WTEP. In this context it is clarified that GST is to be self-assessed by a taxpayer. Therefore, he needs to satisfy himself with the requisite document from a buyer such as supply contracts/order for WTEP from the concerned authorities before supplying goods claiming concession under said entry 234.

3. The applicant has submitted that they collect an Indemnity Bond on Stamp Paper from the customers to confirm that they will use Agro Waste as their fuel in the Boilers supplied to them; Also obtain declaration from the Local Government Authority like Gram Panchayat, Nagarpalika etc ; from customer, where they declare that they will use Agro Waste as their fuel in the boiler.

4. The applicant has submitted Technical Specification and write-up on the Boilers and Sample Declaration collected from Customer.

5. The applicant vide letter dated 27-10-21 has submitted an additional submission wherein it was submitted that it manufactures and supplies boilers namely, Coal based and Biomass based (Waste to energy / Renewable energy plants / devices.). That it is already charging GST @ 18% on the Coal based boiler. The applicant seeks Advance Ruling for Rate of Tax only on Waste to Energy plants (WTEP) i.e. Renewable Energy Boilers, namely:

i. Biopak- biomass fired boiler hybrid fire cum water tube boiler.

ii. Biopak – M Boiler.

iii. Husko-DRP Boiler.

iv Husko Boiler.

v. Bio-Magnum Boiler.

6. The applicant further submitted that the said boilers, fuels such as Coal/Lignite/Petcock cannot be used.

(i) Biopak-The Biomass Fired Boiler (Renewable Energy) Hybrid Fire cum Water Tube Boiler

The Following fuels can be used in this boiler

• Saw Dust
• Maize Pellets
• Cotton Stalks
• Palm Bunch
• Coconut Shell
• Rice Husk
• Wheat/Mustard Straw
• Bagasse
• Agro-Waste Briquettes
• Soya Husk
• Wood Chips/log

(ii) Biopak – M The Biomass Fired Boiler (Renewable Energy)

The Following fuels can be used in this boiler

• Saw Dust
• Maize Pellets
• Cotton Stalks
• Palm Bunch
• Coconut Shell
• Rice Husk
• Rice/Wheat/Mustard Straw
• Bagasse
• Agro-Waste Briquettes
• Soya Husk
• Wood chips/logs

(iii) Husko-DRP – The Drop Feed Biomass Boiler (Renewable Energy) / Fire Tube Boiler / Hybrid Fire Cum Water Tube Boiler

The Following fuels can be used in this boiler

• Saw Dust
• Rice Husk

(iv) Husko-The Biomass Fired Boiler (Renewable Energy)

Hybrid Fire cum Water Tube Boiler

The Following fuels can be used in this boiler

• Saw Dust
• Rice Husk
• Cashew Shell
• Groundnut Shell

(v) Bio-Magnum – The Biomass Fired Power Boiler (Renewable Energy)

The Following fuels can be used in this boiler

• Saw Dust
• Rice Husk
• Cashew Shell
• Groundnut Shell
• Rice/Mustard Straw
• Cotton Stalk
• Bagasse
• Palm Fibre
• Agro-Waste Briquettes

7. The applicant has submitted that Hybrid Boilers does not mean which types of fuels are used in the boiler. Hybrid boiler is boiler which consists of both Fire tubes and Water Tubes. A fire-tube boiler is a type of boiler in which hot gases pass from one or more tubes. The heat of the gases are transferred through the walls of the tubes by thermal conduction thereby water is heated and ultimately generate the steam. A water tube boiler is a type of boiler in which water circulates in tubes heated externally by the fire.

8. The difference between the conventional coal fuel based boilers Vs Renewable Bio mass based boilers is the combustion equipment (Combustion Engine) and its fuel feeding system.

Technical difference in design of a FBC coal fired boiler Vs. an FBC Bio mass fire boiler

Sr.No.	Fuel details	Coal Fired FBC Boiler	Biomass fired FBC Boiler
1.	Fuel varieties	Indian / Indonesia / Australian / South Africa	Rice Husk / Straws (Rice, Wheat, Grass, Mustard, Cotton, Sunflower Etc.) Bagasse / Municipal Waste / Plastic waste from paper Industry / Industrial waste /Bricket of bio mass Etc.
2.	Calorific value	3500 to 6000 Kcal/Kg	3000 to 4000 Kcal/Kg
3.	Volatile matter	Lower	Higher
4.	Fixed Carbon	Higher	Negligible
5.	Fuel density	.7 to .85 Kg/M3	.3 to .6 Kg/M3
6.	Ash density	.75 to .95 Kg/M4	.35 to .65 Kg/M4

9. Question on which Advance Ruling sought

What is the Rate of Tax on Waste to Energy plants (WTEP) i.e. Renewable Energy Boilers manufactured by the applicant.

Personal Hearing

10. Shri Rohinton Engineer, Director and Shri Smith Desai, CA, Shri Chintan Shah, CA and Shri Devam Sheth, CA appeared for the hearing (virtual mode) and reiterated the contents of the application.

Findings

11. At the outset, we would like to state that the provisions of both the CGST Act and the GGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the GGST Act.

12. The applicant is before us seeking the GST rate on said 5 Boilers.

13. The facts on record, as submitted by the applicant are as follows:

i. Fuel used in the said 5 boilers are Agro waste fuels.

ii. Coal/ Lignite/ Pet coke cannot be used as fuels in these 5 boilers.

iii As Per technical literature provided by the applicant, the Fuel varieties in the said 5 boilers are: Argo waste/ Industrial waste/ / plastic waste/ municipal waste/ bricket of biomass.

iv Sample Indemnity cum Undertaking by Buyers of these Boilers reads that that the buyers use Waste as fuel in these Boilers.

14. We agree with the applicant’s contention that heat energy produced from these fuels: biomass/ waste used in the boilers categorise the said Boilers under ‘Waste to Energy Devices’.

15. We find that said 5 Boilers merit classification at HSN 8402, precisely 84021990, reproduced as follows:

8402: STEAM OR OTHER VAPOUR GENERATING BOILERS (OTHER THAN CENTRAL HEATING HOT WATER BOILERS CAPABLE ALSO OF PRODUCING LOW PRESSURE STEAM); SUPER-HEATED WATER BOILERS – Steam or other vapour generating boilers:

8402 19 90 – Other.

16. In conspectus of aforementioned findings and with reference to Sr No 234 of Notification No. 1/2017-CT (R) dated 28-6-17 and 201A of Notification No. 8/2021-CT (R) dated 30-9-21, we pass the Ruling:

Ruling

The said 5 Boilers are leviable to:

i. 5% GST [CGST 2.5% + SGST 2.5%] up to 30-9-21.

ii. 12% GST with effect from 1-10-21.