High Court Rules Solar Inverters Eligible for 5% GST, Quashes ₹120 Cr Tax Demand
The High Court ruled that solar inverters supplied for solar power projects qualify for a 5% GST rate, as they are integral to solar power systems. The court quashed a tax demand of ₹120 crore imposed at an 18% GST rate, affirming that the classification of solar inverters as 'general electrical devices' was erroneous. The ruling supports the petitioners' claims that their products align with the concessional GST rate outlined in Notification No. 1/2017-CT (R).
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The High Court found that solar inverters supplied for solar power projects are eligible for a 5% GST rate, leading to the quashing of a ₹120 crore tax demand. The court determined that the inverters are integral components of solar power-generating systems, countering the previous classification under 'general electrical devices' that attracted an 18% GST.
The ruling recognized that the petitioners' products are covered under Sl.No.234 of Notification No. 1/2017-CT (R), which specifies the concessional tax rate for renewable energy devices. The court dismissed the respondents' claims and confirmed the legality of the petitioners' GST classification.
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