Fuel or raw material

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 December 2011 Coal used by power generating unit is fuel or is raw material? Is there is any case law related to this matter? Under Maharashtra VAT Act treatment for fuel and raw material purchases is different.
Experts, Kindly reply.

MJ Krishnamurthy

MJ Krishnamurthy (Expert)
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01 December 2011 Mr. Author,
Fuel is generally motor spirits such as deisel,petrol or aviation fuel only. Here coal,and specially used for producing electricity should be considered as raw material only. The same principle is adopted in many VAT Acts also. Coal is consumed in the process of producing electricity,the main product, hence it is a raw material in this case.
MJK