GERC Seeks Detailed Proof On GST Claims In Solar PPA Change In Law Petitions

The Gujarat Electricity Regulatory Commission (GERC) issued a daily order on September 1, 2025, in connection with multiple petitions filed under Section 86 (1) (b) and (e) of the Electricity Act, 2003. The petitions, numbered 2269 to 2273 of 2023, were filed by developers including Monex Solar Power LLP, Parasiya K Chhaganlal, N. R. Solar Park, Momai Energy Pvt. Ltd., and Mangalya Energy Pvt. Ltd. against the Paschim Gujarat Vij Company Ltd. (PGVCL). The main issue raised in these petitions relates to the incorporation of a “Change in Law” provision in the Power Purchase Agreements (PPA) to be executed under the Government of Gujarat’s Policy for Development of Small Scale Distributed Solar Projects 2019. The petitioners also sought approval of the draft PPA.

The matter was heard on August 26, 2025. During the proceedings, the respondent’s counsel, Advocate Utkarsh Singh, argued that since all five petitions were identical in nature, similar documents should be provided by each petitioner to establish their claims regarding “Change in Law.” The issue specifically relates to Goods and Services Tax (GST) applicability, where previously the respondent had denied the claim, stating that GST was not covered under Article 9.1 of the PPA.

On this point, the petitioners’ counsel, Advocate Dhruvil V. Kanabar, submitted that the petitioners were prepared to provide evidence as required by the Commission, similar to other petitions seeking recognition of a Change in Law. The Commission, after hearing both parties, directed the petitioners to submit detailed supporting documents within three weeks to substantiate their claims. These include copies of supply agreements for solar PV modules, invoices of procured modules, GST payment challans, bank statements, details of GST and taxes paid, debt and interest costs, bills of lading, packing lists, and invoices. Additionally, a practicing Chartered Accountant’s certificate and an Independent Engineer’s certificate confirming installation of the procured modules at the project site are required. The petitioners must also provide commissioning certificates, CEIG approvals, detailed GST calculation sheets, copies of logistics receipts, and e-way bills.

The Commission made it clear that these submissions should establish a one-to-one correlation between the GST paid and the solar modules procured and installed. The petitioners are required to provide the documents in both chart and tabular formats. The respondent, PGVCL, has been given two weeks’ time to file its response after receiving the petitioners’ submissions.

The Commission stated that the next hearing date would be intimated separately after reviewing the additional documents. With this order, GERC has set a structured process for verifying the claims of Change in Law under the small-scale distributed solar project policy. The outcome of these petitions will be significant in clarifying how taxation issues like GST are treated in renewable energy PPAs in Gujarat.

This decision reflects GERC’s careful approach in balancing the interests of developers and distribution companies while ensuring transparency and proper documentation for claims linked to regulatory changes.