Order Date – 30 December 2022

Facts –

• The appellant, M/s Hojiwala Infrastructure Limited, is a company promoted by cluster of textile processing industries for setting up of Common Effluent Treatment Plant (CETP) to treat and recycled the effluent for Conveyance, Treatment & Disposal of waste water generated from the industries.
• The applicant recycled its treated water to its member units to use it in their process activities.
• The applicant contended that as per Sr. No. 99 of Notification No. 21/2017- Central tax (rate) (as amended), Water [other than aerated, mineral, purified, distilled, medicinal, ionic, battery, de-mineralized and water sold] in sealed container are exempt from GST.

Issue –

• Whether 'Treated Water' obtained from CETP (classifiable under Chapter 2201) will be eligible for exemption from GST by virtue of SI. No. 99 of the Exemption Notification No. 0212017- Integrated Tax (Rate), dated 28-06-2017 (as amended) as 'Water (other than aerated, mineral, purified, distilled, medical, ionic, battery, demineralized and water sold in sealed container)'? 

Order –

• The authorities observed from the exemption entry that specifically 'Water' is eligible for exemption from payment of GST and other types of water i.e. aerated, mineral, distilled, medicinal, ionic, battery, de-mineralized and water sold in sealed container are not covered under entry no. 99 and liable to payment of applicable GST.
• The intention of the legislature to exempt the water was very clear that any type of water which is usually consumed/drink by the public at large of this country should not be taxed. Whereas aerated, mineral, distilled, medicinal, ionic, battery, de-mineralized and water sold in sealed container is not eligible for exemption from payment of GST under the exemption entry.
• In the instant case, after undergoing out all the process treated water obtained from CETP have micro amount of dissolved minerals and chemical and virtually free from all types of toxic materials. This treated water is used in the various industries viz. Pharmaceuticals, chemicals and leather industries for their manufacturing related process. Looking to the presence of small amount of metal and water obtained after treatment from CETP is covered under 'de-mineralize water' . Hence, treated water obtained from CETP is not eligible for exemption under Sr. No. 99 of Notifcation No. l2l2017-CT (Rate) dated 28-6-2017.
• Hence, 'Treated Water' obtained from CETP (classifiable under Chapter 2201) is not eligible for exemption.