Demineralised Water GST Exemption Denied – AAAR Gujarat

  • Blog|News|GST & Customs|
  • 2 Min Read
  • By Taxmann
  • |
  • Last Updated on 9 May, 2025

Latest from Taxmann

demineralised water GST

Case Details: Palsana Enviro Protection Ltd., In re - [2025] 174 taxmann.com 5 (AAAR-GUJARAT)

Judiciary and Counsel Details

  • Rajeev Topno & B.V. Siva Naga Kumari, Member
  • Mihir Gandhi, for the Petitioner.

Facts of the Case

The appellant, a Common Effluent Treatment Plant (CETP), recycles effluent from various industries and supplies treated water to its member units for industrial use. The appellant sought clarification from the Gujarat Authority for Advance Ruling (GAAR) regarding the classification of the treated water and its eligibility for exemption under Sl. No. 99 of Notification No. 2/2017-Central Tax (Rate), dated 28-06-2017, as amended by Notification No. 7/2022-Central Tax (Rate), dated 13-07-2022. The exemption is granted to purified water intended for consumption by the public.

The appellant argued that the treated water, although used for industrial processes, was purified and free from toxic materials, and therefore, should qualify for the exemption. The appellant submitted a laboratory certificate to support the claim that the treated water was purified. However, the GAAR determined that the treated water from the CETP, while free from toxic materials, still contained trace amounts of dissolved minerals and chemicals, classifying it as ‘de-mineralised water’ and therefore not eligible for the exemption under the notification. Aggrieved with the Gujarat AAR’s findings, the appellant then approached the Gujarat Authority for Advance Ruling (AAAR) for a further review.

AAAR Held

The Hon’ble Gujarat AAAR upheld the Gujarat AAR’s finding that the treated water from the Common Effluent Treatment Plant (CETP) is de-mineralised water and ineligible for exemption under the said notifications. The appellant’s laboratory certificate, submitted at the appellate stage, was not accepted due to its lack of accreditation and details on the sampling method. Referring to a similar Tamil Nadu AAR ruling, the AAAR confirmed the treated water’s taxability.

List of Cases Reviewed

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that’s easy to read and remain consistent across all imprint and digital publications are applied

Leave a Reply

Your email address will not be published. Required fields are marked *

«
»

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on Taxmann.com

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied