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2025:APHC:56077 APHC010074192022 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI [3529]
(Special Original Jurisdiction)
WEDNESDAY, THE THIRD DAY OF DECEMBER TWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICE R RAGHUNANDAN RAO THE HONOURABLE SRI JUSTICE T.C.D.SEKHAR WRIT PETITION Nos.: 4799 & 4801 of 2022 and WRIT PETITION Nos.: 17132 & 17177 of 2024 WRIT PETITION NO: 4799/2022 Between:
1. M /S. SIEMENS GAMESA RENEWABLE POWER PRIVATE LIMITED, REP. BY ITS HEAD-INDIRECT TAXES, MR. LAKSHMINARAYAN GANESHWAR, 1, IKSEZ OFFICE PREMISES, ADJACENT TO NH-5, RACHARLAPADU VILLAGE AND POST, NELLORE DISTRICT-514
319.
...PETITIONER AND
1. T HE ASSISTANT COMMISSIONER ST, KAVALI CIRCLE, NELLORE DIVISION, NELLORE.
2. T HE JOINT COMMISSIONER, (STATE TAX) AND APPELLATE AUTHORITY, TIRUPATHI.
3. T HE STATE OF ANDHRA PRADESH, REP. BY ITS PRINCIPAL SECRETARY TO GOVERNMENT, REVENUE (CT-II) DEPARTMENT, SECRETARIAT, VELAGAPUDI, AMARAVATHI, GUNTUR DISTRICT.
4. T HE UNION OF INDIA, REP. BY ITS SECRETARY, MINISTRY OF FINANCE, 3RD FLOOR, JEEVAN DEEP BUILDING, SANSAD MARG, NEW DELHI-110 001. ...RESPONDENT(S):
Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased tomay be pleased to issue a Writ of Certiorari or any other appropriate writ or order or direction - (a) quashing the order of the 2nd Respondent in Order No.ZD371021005685Q, dated 29.10.2021 confirming the Order No.ZH3712200D16075 dated 29.12.2020 and Order No. ZH3712200D40688 dated 29.12.2020 and the Form GST DRC-07 No.ZD3712200063035 dated 30.12.2020 passed by the 1st Respondent as illegal, arbitrary without jurisdiction, pre-determined and contrary to Law. (b)declare that the nature of the transactions executed by the Petitioner, viz., supply, erection and commissioning of . the Wind Turbine Generators is a composite supply of goods and services under Section 2(30) of the CGST and SGST Acts 2017 on which the Petitioner is liable to pay tax @5percent on the entire value of the contract for the tax period 1.7.2017 to 31.03.2018. (c)declare the imposition of interest on output liability from the date of filing of the return as illegal and contrary to the Section 50 read with Section 78 of the Goods and Services Tax Act. and (d)declare that the interest cannot be imposed under Section 50 (3) of the Central Goods and Services Tax Act, 2017 on reversal of the credit consequent upon the ascertainment of ineligible input tax credit which does not result in any additional tax liability, and pass such IA NO: 1 OF 2022 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased may be pleased to grant stay of all further proceedings including recovery of the demand pursuant to the impugned order of the 2nd Respondent, dated 29.10.2021 and the order of the Respondent dated 29.12.2020 for the tax period July, 2017 to March, 2018, pending disposal of the Writ Petition as otherwise the Petitioner will be put to severe loss and hardship.
Counsel for the Petitioner:
1. KARTHIK RAMANA PUTTAMREDDY Counsel for the Respondent(S):
1. GP FOR COMMERCIAL TAX
2. Asst Solicitor General WRIT PETITION NO: 4801/2022 Between:
1. M /S. SIEMENS GAMESA RENEWABLE POWER PRIVATE LIMITED,, REP. BY ITS HEAD-INDIRECT TAXES, MR. LAKSHMINARAYAN GANESHWAR, 1, IKSEZ OFFICE PREMISES, ADJACENT TO NH-5, RACHARLAPADU VILLAGE AND POST, NELLORE DISTRICT-514
319 ...PETITIONER AND
1. T HE ASSISTANT COMMISSIONER ST, KAVALI CIRCLE, NELLORE DIVISION, NELLORE.
2. T HE JOINT COMMISSIONER STATE TAX, AND APPELLATE AUTHORITY, TIRUPATHI.
3. T HE STATE OF ANDHRA PRADESH, REP. BY ITS PRINCIPAL SECRETARY TO GOVERNMENT, REVENUE (CT-II) DEPARTMENT, SECRETARIAT, VELAGAPUDI, AMARAVATHI, GUNTUR DISTRICT.
4. T HE UNION OF INDIA, , REP. BY ITS SECRETARY, MINISTRY OF FINANCE, 3I'D FLOOR, JEEVAN DEEP BUILDING, SANSAD MARG, NEW DELHI-110 001. ...RESPONDENT(S):
Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased topleased to issue a Writ of Certiorari or any other appropriate writ or order or direction - (a) quashing the order of the 2nd Respondent in Order No.ZD371021005696N, dated 29.10.2021 confirming the Order No.ZH3712200D16075 dated 29.12.2020 and Order No. ZH3712200D40688 dated 29.12.2020 and the Form GST DRC-07 No.ZD371220006307X dated 30.12.2020 passed by the 1st Respondent as illegal, arbitrary without jurisdiction, pre-determined and contrary to Law, (b) declare that the nature of the transactions executed by the Petitioner, viz., supply, erection and commissioning of the Wind Turbine Generators is a composite supply of goods and services under Section 2(30) of the CGST and SGST Acts 2017 on which the Petitioner is liable to pay tax @5percent on the entire value of the contract for the tax period 1.4.2018 to 31.03.2019, (c) declare the imposition of interest on output liability from the date of filing of the return as illegal and contrary to the Section 50 read with Section 78 of the Goods and Services Tax Act, and (d) declare that the interest cannot be imposed under Section 50 (3) of the Central Goods and Services Tax Act, 2017 on reversal of the credit consequent upon the ascertainment of ineligible input tax credit which does not result in any additional tax liability, and pass IA NO: 1 OF 2022 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased pleased to grant stay of all further proceedings including recovery of the demand pursuant to the impugned order of the 2'd Respondent, dated 29.10.2021 and the order of the 1st Respondent dated 29.12.2020 for the tax period 1.4.2018 to 31.03.2019, pending disposal of the Writ Petition as otherwise the Petitioner will be put to severe loss and hardship.
IA NO: 2 OF 2022 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased pleased to vacate the interim Orders granted in WP.No.4801 of 2022 dated
24-03-2022 and pass Counsel for the Petitioner:
1. KARTHIK RAMANA PUTTAMREDDY Counsel for the Respondent(S):
1. Asst Solicitor General
2. THE ADVOCATE GENERAL (AP)
WRIT PETITION NO: 17132/2024 Between:
1. M /S SIEMENS GAMESA RENEWABLE POWER PRIVATE LIMITED, SIEMENS GAMESA RENEWABLE POWER PRIVATE LIMITED, REP. BY ITS GENERAL MANAGER, HEAD - INDIRECT TAXES, MR. ASHOK RAJ 1, IKSEZ OFFICE PREMISES, ADJACENT TO NH-5, RACHARLAPADU VILLAGE AND POST, NELLORE DISTRICT-524
319.
...PETITIONER AND
1. A SSISTANT COMMISSIONER, KAVALI CIRCLE, NELLORE DIVISION, NELLORE.
2. A DDITIONAL COMMISSIONER STATE TAX AND APPELLATE AUTHORITY, TIRUPATHI.
3. S TATE OF ANDHRA PRADESH, REP. BY ITS PRINCIPAL SECRETARY TO GOVERNMENT REVENUE (CT-II) DEPARTMENT, SECRETARIAT, VELAGAPUDI, AMARAVATHI, GUNTUR DISTRICT.
4. U NION OF INDIA, REP. BY ITS SECRETARY, MINISTRY OF FINANCE, 3RD FLOOR, JEEVAN DEEP BUILDING, SANSAD MARG, NEW DELHI-110 001. ...RESPONDENT(S):
Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased toMay be pleased to issue a Writ of Certiorari or any other appropriate writ or order or direction quashing the order of the 2nd Respondent in Order No.ZD370424007656C, dated 10.4.2024 confirming the levy of penalty vide Orders of the 1st Respondent vide A.O.No.ZH3711210D 95903 dated 18.11.2021 (COST) and vide AO No.ZH3711210D95054 dated 18.11.2021 (SGST) and proceedings in Form GST DRC-07 vide Ref.No.ZD 3711210067581 dated 29.11.2021 passed by the 1st Respondent for the tax period July, 2017 to March, 2018 as illegal, arbitrary without jurisdiction and contrary to Law and pass IA NO: 1 OF 2024 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased may be pleased to grant interim stay of recovery of the disputed penalty in a sum of Rs.2,72,07,208/- for the tax period July, 2017 to March, 2018, as assessed by the 1®* Respondent and as confirmed by the 2^^ Respondent vide order dated 10.4.2024, under the GST Act, 2017, pending disposal of the Writ Petition, as otherwise the Petitioner will be put to severe loss and hardship IA NO: 2 OF 2024 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased pleased to vacate the interim stay order granted Dt. 07.08.2024 in W.P. No.
17132 of 2024 and pass Counsel for the Petitioner:
1. KARTHIK RAMANA PUTTAMREDDY Counsel for the Respondent(S):
1. GP FOR COMMERCIAL TAX WRIT PETITION NO: 17177/2024 Between:
1. S IEMENS GAMESA RENEWABLE POWER PRIVATE LIMITED, REP.
BY ITS GENERAL MANAGER, HEAD - INDIRECT TAXES, MR. ASHOK RAJ 1, IKSEZ OFFICE PREMISES, ADJACENT TO NH-5, RACHARLAPADU VILLAGE AND POST, NELLORE DISTRICT-524
319.
...PETITIONER AND
1. A SSISTANT COMMISSIONER, (ST), KAVALI CIRCLE, NELLORE DIVISION, NELLORE.
2. A DDITIONAL COMMISSIONER STATE TAX AND APPELLATE AUTHORITY, TIRUPATHI.
3. S TATE OF ANDHRA PRADESH, REP. BY ITS PRINCIPAL SECRETARY TO GOVERNMENT, REVENUE (CT-II) DEPARTMENT, SECRETARIAT, VELAGAPUDI, AMARAVATHI, GUNTUR DISTRICT.
4. U NION OF INDIA, REP. BY ITS SECRETARY, MINISTRY OF FINANCE, 3RD FLOOR, JEEVAN DEEP BUILDING, SANSAD MARG NEW DELHI-110 001. ...RESPONDENT(S):
Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased topleased to issue a Writ of Certiorari or any other appropriate writ or order or direction quashing the order of the 2nd Respondent in FORM GST APL-4 vide Order No.ZD370424007691l, dated 10.4.2024 confirming the levy of penalty vide Orders of the 1st Respondent vide AO NO.ZH3711210D95903 dated 18.11.2021 (COST) and vide AO No.ZH 3711210D95054 dated 18.11.2021 (SGST) and proceedings in Form GST DRC-07 vide Ref.No.ZD371121006763R dated 29.11.2021 to the extent of tax period April, 2018 to January, 2019 as illegal, arbitrary without jurisdiction and contrary to Law and pass IA NO: 1 OF 2024 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased pleased to grant interim stay of recovery of the disputed penalty in a sum of Rs.2,27,56,036/- for the tax period April, 2018 to January, 2019, as assessed by the 1st Respondent and as confirmed by the 2nd Respondent vide order dated 10.4.2024, under the GST Act, 2017, pending disposal of the Writ Petition, as otherwise the Petitioner will be put to severe loss and hardship.
Counsel for the Petitioner:
1. KARTHIK RAMANA PUTTAMREDDY Counsel for the Respondent(S):
1. GP FOR COMMERCIAL TAX
2.
The Court made the following Common Order: (per Hon’ble Sri Justice R. Raghunandan Rao)
Heard Sri Karthik Ramana Puttam Reddy, learned counsel for the petitioner and the learned Government Pleader for Commercial tax, appearing for the respondents.
2. The petitioner, who is registered under the Central Goods and Services Tax Act (CGST) and the State Goods and Services Tax Act (SGST) 2017, is in the business of designing, manufacturing, supplying, developing, assembling, erecting and installing Wind Turbine Generators. The petitioner, in the course of its business, during the periods 2017-2018 and 2018-2019, had entered into various contracts for manufacture and erection of Wind Turbine Generators, for its customers. The petitioner treated these contracts as composite supplies of goods and services and paid tax @ 5%. However, the 1st respondent initiated assessment proceedings on the ground that the contracts executed by the petitioner should be treated as works contracts involving immovable property, taxable @ 18%. The 1st respondent, had passed two separate Orders of Assessment, for the periods July 2017 to March 2018 and April 2018 to September 2019 (the disputed turn-over is only up to March 2019), dated 30.12.2020. Aggrieved by these orders, the petitioner has approached the 2nd respondent, by way of an appeal. The 2nd respondent affirmed the orders of the 1st respondent, by way of two separate orders, dated 29.10.2021.
3. Aggrieved by these orders, the petitioner has approached this Court, by way of W.P.Nos.4799 of 2022 and 4801 of 2022.
4. The 1st respondent also initiated penalty proceedings, culminating in two separate orders, dated 29.11.2021, levying penalty on the petitioner. Aggrieved by these orders of penalty, the petitioner again approached the 2nd respondent, who confirmed the orders of penalty, by way of two separate orders, dated 10.04.2024.
5. Aggrieved by these orders, the petitioner has approached this Court, by way of W.P.Nos.17132 of 2024 and 17177 of 2024.
6. The contention of the petitioner is that movable property is created, by virtue of contracts executed by it, and consequently, the supply of goods and services, made by the petitioner, in the course of its contracts, can only be treated as composite supply of goods and services, liable to tax @ 5%.
7. The respondent authorities, on the other hand, took the view that the Wind Turbine Generators, which are attached to earth, would amount to immovable property and consequently, the contracts executed by the petitioner would attract tax @ 18%.
8. The central issue, in all these Writ Petitions, is about the nature of the Wind Turbine Generators assembled and erected by the petitioner. For the purpose of these Writ Petitions, the facts, as assumed by the 2nd respondent- Appellate Authority, are being taken as undisputed facts in the present cases. The said facts are extracted in extenso:
What is Wind Turbine Generator
14. As per technical note dt.01.06.2020 on ‘Turbine movability’, Wind power is generation of electricity from wind. Wind power is converted to electrical energy by wind turbines. As per IEC 61400-1 design standards, a wind turbine generator system (WTG) is defined as that which "converts kinetic energy in the wind into electrical energy". Wind turbines generate electricity using generators. It is designed to convert the kinetic energy of wind into electricity. Wind power generation means getting the electrical energy by converting wind energy into rotating energy of the blades and converting that rotating energy into electrical energy by the generator. Wind energy increases with the cube of the wind speed, therefore WTGs should be installed in the higher wind speed area.
15. The functioning of the wind mill works in the following manner : the rotor blades capture the wind energy and convert it to rotational energy of shaft to which the rotor blades are fixed. The shaft transfers the rotational energy into the generator. Then the role of the casing that
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