ORDER :

C.PRAVEEN KUMAR, J.

1. The Present Writ Petition came to be filed by the Petitioner challenging the Order-in-Appeal No. ZH3710OD19206, dated 20-10-2020, passed by the 1st Respondent demanding the Petitioner to pay GST amounting to Rs.63,00,19,512/- for the period from November 2017 to September 2018 along with interest and penalties equal to 10% of the tax demanded.

2. The Petitioner is a company engaged as a contractor by various entities for supply, installation, testing and commissioning of Solar Power Generating System.

3. Realizing the importance of regenerative nature and cheap cost of product, the Government accorded greater importance for setting up of solar power projects and imposed Goods and Service Tax at 5% (2.5% CGST and 2.5% SGST) on solar equipment. However, the services relating to setting up of solar power projects are charged GST at 18% (9% CGST and 9% SGST).

4. The Petitioner herein, used to enter into contracts with prospective buyers of solar power plants for supply and installation of equipment under turnkey basis and paid GST at 5% on supply value of equipment and 18% on the erection and installation of the said equipment.

5. It is submitted that, the import duty/GST on the inputs procured by the Petitioner i.e. on solar modules and steel was charged at 18% as against the GST rate of 5% on the finished goods cleared by the Petitioner. Due to this inverted duty structure, the Petitioner accumulated Input Tax Credit. To have cash flow, the Petitioner filed a refund application for accumulated ITC, citing inverted duty structure, and claimed refund of Rs.8,65,63,538/- for period from January 2018 to March 2018. However, the said claim was rejected by the competent authority, aggrieved by which, Petitioner filed an appeal.

6. While things stood thus, the Assistant Commissioner of State Tax issued notice dated 17.09.2019, proposing demand of GST @ 18% on the ground that the proposing assessment activity rendered by the petitioner is under the Works Contract Service and has nothing to do with the supply of Goods and provisions of Service and accordingly demanded GST @ 18% of the value of the supply.

7. A reply came to be filed disputing the claim made by the authorities. However, the original authority confirmed the activity under the Works Contract Service and consequently demanded GST of Rs.63,00,19,512/- (CGST – Rs.31,50,09,756/- and SGST- Rs.31,50,09,756/-) along with interest covering the period from November, 2017 to September, 2018 and imposed equivalent penalty under Section 74(1) of the GST enactments.

8. Aggrieved by the Assessment Order, the Petitioner filed an appeal before first Appellate Authority under Section 107 of AP GST Act, 2017, by pre-depositing 10% of the GST.

9. In appeal before the first Appellate Authority, Petitioner contended that supplies made by them do not fall under the scope of Works Contract Service since the activity undertaken by them in erection and commissioning of the solar equipment, was for the limited purpose of operation efficiency and does not render the same immovable and, if required, the equipment can be dismantled and reassembled at some other place. Petitioner also contended that merely because part of the activity involves civil works, the total supply cannot be assumed to be works contract service, since the plant is not immovable in nature. The activity rendered is a composite supply consisting of supply of goods, where the predominance is that of goods, thereby the principal supply is deemed to be the supply for levy of GST. However, the First Appellate Authority rejected the contention of the Petitioner and confirmed the GST liability and imposed penalty of 10% of tax amount.

10. Thereafter, the 2nd respondent vide DRC-09 dated 23.10.2020 issued a recovery of tax confirmed in the Appeal though a period of three months is allowed, for initiating the recovery proceedings in terms of Section 78 of APGST Act, 2017. Challenging the same, the present writ petition