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2020 (3) TMI 618 - AAR - GSTInput Tax Credit - GST paid on goods purchased for the purpose of construction & maintenance of Warehouse such as Vitrified Tiles, Marble, Granite, ACP sheet, Steel Plates, TMT Tor(saria), Bricks, Cement, Paint and other construction material - GST paid on work contract service received from registered & unregistered Contractor for construction & maintenance contract of building - GST paid on goods purchased & works contract service received during the FY 2017-18 for the purpose of construction & maintenance of Warehouse - whether ITC can be claimed in full or not? HELD THAT:- As per the Section 16 of CGST Act, 2017, every registered person shall entitle for ITC subject to such conditions and restriction as may be prescribed. As per the Section 17(5) of CG5T Act mentioned above, the Input tax credit shall not be available on the goods and services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business. In the present case, the applicant constructed the building/warehouse which is a immovable property and as per the exclusion clause 17(5) (d)of CGST Act, 2017, the input tax credit is not available on the goods and services used in construction of immovable property. The Section 17(5) of CGST Act is an exclusion clause in spite of the goods or services used in the course or for furtherance of his business as the Section 16 of CGST ACT, it is clearly mentioned that the entitlement of ITC is subject to the condition and restriction. The view of applicant that they are entitled for ITC in view of Section 16 is incorrect as per law - Further the applicant stated that if the ITC is not allowed as per the Section 17(5) (d) then it is unwarranted, unreasonable, arbitrary, unconstitutional, illegal, violation of fundamental right, double taxation is baseless as the Section 17(5)(d) of CGST Act is very clear and there is no scope of interpretation but in spite of clearcut law, the Applicant has wrongly interpreted the Section to avail the benefit of inadmissible ITC. The submission of Applicant that if ITC is not admissible, it would render building now constructed for renting out uncompetitive is also not correct as the said provision of Section 17(5)(d) of CGST Act, is applicable to all not only to the applicant only. Thus, it can be concluded that the ITC is not admissible on the goods and services received and used in the construction of warehouse used for letting out on rent as per the Section 17(5)(d) of CGST Act, 2017. Thus, it is finally held that no ITC of GST paid on goods purchased for the purpose of construction & maintenance of Warehouse such as Vitrified Tiles, Marble, Granite, ACP sheet, Steel Plates, TMT Tor (saria), Bricks, Cement, Paint and other construction material is admissible under Section 17(5) of CGST Act, 2017; no ITC of GST paid on work contract service received from registered & unregistered Contractor for construction & maintenance contract of building is admissible under Section 17(5) of CGST Act, 2017; and; no ITC of GST paid on goods purchased & works contract service received during the FY 2017-18 for the purpose of construction & maintenance of Warehouse is admissible under Section 17(5) of CGST Act, 2017.
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