2018 (11) TMI 401 – AUTHORITY FOR ADVANCE RULING HIMACHAL PRADESH – 2018 (18) G. S. T. L. 53 (A. A. R. – GST) – Classification of manufactured item – items used for manufacture of Solar Cells – whether parts for manufacture of Photovoltaic Cells/Solar Cells to be covered under Entry 234 of Schedule-I of Notification No. 1/2017-Integrated Tax (Rate), dated 28-6-2017 or not?
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Held that:- It is clear from the whole manufacturing process that silicon wafer is the most important input for the manufacture of solar cells which is treated with the various chemicals during the different steps of texturization, diffusion, junction edge isolation anti-reflection coating, etc. The various chemicals used during the manufacturing process have been specified in Table A from Sr. No. 2-13. These chemicals, though used in the process, yet get consumed & lose their independent identity'.
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To qualify as being part of the product for the purpose of aforesaid notification, the item should mainta
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referred to as CGST Act, 2017 & HPGST Act, 2017). The Applicant M/s. Jupiter Solar Power Ltd. Baddi is a registered taxpayer & is engaged in manufacture of solar photovoltaic cells in its factory located at Baddi, Distt. Solan (H.P.). 2. For admission & hearing u/s 98 of the CGST Act, 2017/HPGST Act, 2017, notice was issued to the applicant on dated 10-7-2017 directing him to appear on 16-7-2017. However, on 16-7-2017, Mr. Daman Thakur, representative of the applicant appeared & requested for adjournment on the grounds that the Counsel was unable to appear on that date due to prior engagements. Plea was accepted & hearing was adjourned for 19-7-2017. On 19-7-2017, Sh. Pramod Kumar Rai, Advocate for the Applicant along with Sh. Sandeep, Associate Vice-President of the applicant firm M/s. Jupiter Solar Power Ltd. appeared. On scrutiny of the application, it was observed that the Applicant has deposited an amount of ₹ 10,000/- (i.e. ₹ 5000/- against fee und
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cells, the Applicant procures (imported as well as indigenous) following items/ parts/ materials which are essential components of Solar Photovoltaic Cells. Out of these items Silicon Wafers is the most important item which absorbs the photons & in turn generates electricity.Table A-List of inputs for manufacture of Solar Photovoltaic Cells: Sr. No. Description Classification 1. Undiffused polycrystalline silicon wafers 3808 00 10 2. Aluminum paste 3212 90 30 3. Hydrofluoric Acid (HF) 2811 11 00 4. High purity salane (SIH4) 2804 69 00 5. Phosphorus oxychloride (POC13) 2812 12 00 6. High Purity Nitrogen(N2) 2804 30 00 7. High purity Ammonia 2814 10 00 8. Nitric Acid (HNO3) 2808 00 10 9. Printing screens for solar cells 8443 99 90 10. High purity oxygen 2804 40 90 11. Hydrochloric Acid(HCL) 2806 10 00 12. Potassium Hydroxide(KOH) 2815 20 00 13. Polycrystalline silicon Texturing Additive 3402 19 00 (b) All the above stated items when procured for their independent use, attract differ
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f the solar/photovoltaic cells. It is contained in the solar cell & visible in it. However, when it is taken out, major damage shall be caused because it is fitted in somewhat permanent way. Without wafer the functional value of the photovoltaic cell becomes NIL because the wafers help in creating electricity by absorbing photons from the sunlight. (b) The expression used in Entry 234 of Schedule-I of Notification above is not "Part of Photovoltaic cell" rather it is "Part for manufacture of Photovoltaic cell". There is nothing contained in the solar cell which can be taken out without damage & put into another cell. More than 70% of the value of materials of the solar/photovoltaic cell is coming from Silicon wafers. If wafers cannot be treated as part for the manufacture of solar/ photovoltaic cells then on that logic no other item will qualify as part of solar/ photovoltaic cells. (c) Therefore, the only interpretation which is given in the context is that
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working capital. (e) Therefore the applicant is of the view that the products mentioned in table A should be ruled as pail for the manufacture of Photovoltaic cells & therefore shall be charged 5% of IGST on procurement. 6. Observation (1) Table A specifies various items which are procured for the manufacturing of Photovoltaic/ Solar cells. These items are used in the manufacturing process as under :- (a) During the process of manufacturing of solar cells, the Silicon wafers are cleaned with various chemicals (like Hydrofluoric Acid (HF)), Nitric Acid (HNO3), Hydrochloric Acid (HCL), Potassium Hydroxide (KOH) & Polycrystalline (Silicon Texturing Additive) through the process of texturization. (b) In the second step, the cleaned Silicon Wafers are treated through diffusion process for creating p/n-junctions (positive & negative) by use of Phosphorous Oxychloride (POC13), High Purity Oxygen (O2) & High Purity Nitrogen (N2). (c) Thereafter, the Silicon wafers are further p
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ers of the solar cells like efficiency, short circuit current, open circuit voltage, fill factor, shunt resistance etc. (2) It is clear from the whole manufacturing process mentioned above that silicon wafer is the most important input for the manufacture of solar cells which is treated with the various chemicals during the different steps of texturization, diffusion, junction edge isolation anti-reflection coating, etc. The various chemicals used during the manufacturing process have been specified in Table A from Sr. No. 2-13. These chemicals, though used in the process, yet get consumed & lose their independent identity'. To qualify as being part of the product for the purpose of aforesaid notification, the item should maintain substantial independent physical identity as when it is used in the final product. All these items mentioned in Table A from Sr. No. 2-13, instead of being treated as parts for the purpose of Entry 234 of the Notification No. 1/2017-IGST (Rate), can o
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ading 8486. In this case silicon wafer falls specifically in chapter heading 3818 that is why duty rate thereof will be applicable. (2.3) Furthermore, along with some other inputs/ items, silicon wafers, as specified at Sr. No. 1 of Table A, is the most important input for the manufacturing of Photovoltaic cells & makes up almost the whole of Photovoltaic cells. It is contained in the solar cell & visible in the solar cell. It is also clear that without the Silicon wafer, the functional value of the Photovoltaic cell is NIL as Silicon wafers help in creating electricity by absorbing photons from the sunlight. The close physical examination of the photovoltaic cell reveals that along with some other inputs/ items it is made up of silicon wafer only which is treated with various chemicals in order to make it usable as voltaic/ solar cell. In other words, the photovoltaic cell can be called as chemical treated 'Silicon wafer' along with other inputs/ items. This is similar
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