In Advance Ruling No.21/ARA/2023 -AAR- AAR (Tamil Nadu) rules that sale of used Wind Turbine Generator/Wind Mill with accessories is a ‘Composite Supply’ of Wind Mills, liable to GST at 6%
Members N. Usha (SGST) & R. Gopalsamy (CGST) [20-06-2023]

Read Order: In Re: M/s Raja Dheepam Spinning Mills Private Limited

Chahat Varma

New Delhi, September 1, 2023: The Tamil Nadu bench of the Authority for Advance Rulings has ruled that the sale of used Wind Turbine Generator (WTG)/Wind Mill with its accessories constitutes a composite supply of Wind Mills and is liable to tax at the rate of 6% under the Central Goods and Services Tax Act (CGST Act).

M/s Raja Dheepam Spinning Mills Private Limited (applicant) had submitted their intention to sell a WTG Mill situated in Sankarandampalayam Village, Tirupur District, along with the land on which the wind mill was installed. They had sought an advance ruling to clarify various aspects related to the sale.

The bench of N. Usha (SGST) and R. Gopalsamy (CGST) observed that the transaction of the applicant involving the sale of the wind mills was covered under Clause 4 of Schedule II of the CGST Act, as the transaction involved disposal of business assets. As a result, the sale of wind mills constituted a supply of goods.

The bench further determined that the supply of a wind mill, inclusive of its parts and accessories, qualified as a composite supply of the wind mill. It was subject to a CGST tax rate of 6% effective from 01.10.2021, vide entry no. 201A of Notification No. 01/2017 Central Tax (Rate), dated 28.06.2017 as amended vide Notification No.08/2021 Central Tax (Rate), dated 30.09.2021.

Furthermore, the bench confirmed that the appropriate HSN code for WTG/Wind Mill was 8412 80 30.

Regarding the sale of the land on which the wind mill was situated, the bench referred to information from the Commercial Taxes and Registration Department, Tamil Nadu. The prevailing practice indicated that windmills were not considered immovable property for stamp duty purposes. Consequently, stamp duty was levied solely on the transfer of land. In accordance with GST laws, the bench held that the sale of land was not subject to GST, as it was neither treated as a supply of goods nor a supply of services under clause 5 of Schedule III of the CGST Act.