Customs - Exemption - Ash Handling Systems, Water Treatment Plant and Coal Transportation Facilities etc. outside power plants - CBEC clarifies

By Vijay Kumar

NOTIFICATION No. 12/2012-Central Excise (S. Nos. 337&338), dated 17-03-2012, provides exemption to machinery, instruments, apparatus and appliances etc. required for setting up of ultra-mega/ mega power projects. The Explanation clarifies that the goods required for setting up of these projects include the goods required for development of facilities such as ash disposal system including ash dyke, water intake including treatment and storage facilities and coal transportation facilities for such a project, notwithstanding the fact that such facilities are set up inside or outside the power plant's designated boundary.

Representations have been received from the trade and industry that the benefit of exemption is being denied to the afore-cited goods when they are imported for setting up of ultra-mega/ mega power projects. It has been requested that, for removal of doubts, a clarification, on the lines of excise exemption, should be issued by the Ministry that the said goods required for ultra-mega/ mega power projects are eligible for customs duty exemption.

In response, the CBEC clarifies that the goods required for development of facilities such as ash disposal system including ash dyke, water intake including treatment and storage facilities and coal transport facilities required for ultra-mega/ mega power projects are eligible for customs duty exemption, notwithstanding the fact that such facilities are set up inside or outside the power plant's designated boundary.

Let us hope the Board's clarification would not be over-ruled by the field.

CBEC Circular No. 33/2013-Cus., Dated: August 23, 2013