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2019 (10) TMI 1021 - AAR - GSTBlocked credits or not - Section 17(5) (d) of the CGST Act, 2017 read with Explanation to Chapter V and Chapter VI of the CGST Act, 2017 - taxes paid on procurement of goods and/or services for installation of Chillers, Air Handling Unit (AHU), Lift, Escalators and Travellator, Water Treatment Plant (WTP), Sewage Treatment Plant (STP), High Speed Diesel Yard (HSD), Mechanical Car Park (MLCP), Indoor / Outdoor Surveillance System (CCTV), D.G.Sets, Transformers, Electrical wiring and fixtures, Public Health Engineering (PHE), Fire-fighting and water management pump system, referred to as “Installations” - Applicant submits that although the Installations are fixed to the building/ earth, they qualify as ‘Plant’ or ‘Machinery’ under the CGST Act, 2017 and accordingly, the taxes paid on procurement of goods or services for such Installations should not be regarded as blocked credits in terms of Section 17(5) (d) of the CGST Act, 2017 read with Explanation to Chapter V and Chapter VI of the CGST Act, 2017. HELD THAT:- The property in question is given on rent for enjoyment of the tenant and the additional charges are charged for the maintenance - The applicant has installed Chillers, Air Handling Units, Lift, Escalator, Travellator, Water Treatment Plant, Sewage Treatment Plant, HSD Yard, Mechanical Car Park, Surveillance System, DG Sets, Transformers, Electrical Wiring and fixtures and PHE, Firefighting and water management pump system and other facilities of the building. The applicant has procured the goods and services for installation of these. The applicant has stated that he has procured goods or services or both for the purposes of additions to the said immovable property and has capitalized them in his books of accounts. Therefore, the same are covered under the expression “construction of an immovable property” and hence the input tax credit on the goods or services or both received by a taxable person in respect of such construction is not available - The claim of the applicant that the immovable property is a plant and hence the covered under the exception in Section 17(5)( d) is verified and it boils to the issue whether the listed items are covered under the definition of “plant”. The definition of Plant and Machinery is in the context of “plant and machinery” and includes “apparatus, equipment and machinery” and contextually, the word “plant could include apparatus and equipments fixed to the earth by foundation or structural support that are used for making outward supply of goods or services or both and includes such foundation and structural supports, whereas machinery would be covered separately. The exclusion clause relating to “land, building and any other civil structure” would be applicable to this “plant” and hence input tax credit is not available as it is a civil structure. The provision of facilities like transformers, sewage treatment plant, Electrical Wiring and Fixtures, Surveillance systems, D.G. Sets, Lifts, Air Handling Units etc. are sine-qua-non for a commercial mall and hence cannot be considered separate from the building or civil structure. The provision of these are either statutory for a building or defines the nature of the building as a commercial mall. Hence the input tax credit on the inward supplies of goods or services involved in the construction of immovable property which is a civil structure or building is not available to the applicant and hence blocked. Thus, the taxes paid on procurement of goods and/or services for installation of the Installations as listed in the application are regarded as blocked credits under Section 17(5) of the CGST Act, 2017.
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