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2020 (1) TMI 662 - AAR - GSTInput tax credit - input/input services - civil work - External Developmental Works - whether the Applicant is eligible to take input tax credit on the goods and services supplied by M/s. Akanksha Contracts Pvt. for carrying out the activities (civil work and External Developmental Works) for setting up of MRO facility which will be rented out? HELD THAT:- The activity of MRO involving supply of goods and services is leading to creation of an immovable property. Section 16 (1) of the GST Act specifically provides that every registered person shall be entitled to take credit of the input tax charged on any supply of goods or services or both made to him, which are used or intended to be used in the course or furtherance of his business. Such entitlement is subject to fulfillment of certain conditions such as possession of invoice, receipt of goods/ service, payment of tax to Government etc. as provided under Section 16(2) of the GST Act, 2017 - thus, ITC is not available for construction of an immovable property even when such goods or services or both are used in course or furtherance of business. The applicant is paying GST on goods and services supplied by M/s. Akanksha Contracts Pvt. Ltd. for construction of MRO facility on the applicant's land. The provisions of Section 17(5)(d) of GST Act, 2017 is clear that if the goods or services are used for the construction of an immovable property, the ITC shall not be available irrespective of the use of the said property. The applicant is not eligible to claim credit of the GST charged by vendor for supply of goods and services to it, which are used for carrying out the activities (Civil Work and External Developmental Works) for setting up of MRO facility.
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