TMI Blog2019 (2) TMI 1009X X X X Extracts X X X X X X X X Extracts X X X X ..... h. The warehouse being constructed is, therefore, an immovable property, and the input tax credit is not admissible on the inward supplies for its construction, as the credit of such tax is blocked under section 17(5) (d) of the GST Act. The warehouse being constructed is immovable property. The input tax credit is, therefore, not admissible on the inward supplies for construction of the said warehouse, as the credit of such tax is blocked under section 17(5)(d) of the GST Act. - Case No. 36 of 2018 Order No. 40/WBAAR/2018-19 - - - Dated:- 18-2-2019 - SYDNEY D SILVA AND PARTHASARATHI DEY, MEMBER Applicant s representative heard Arani Tewari, FCA 1. The Applicant, stated to be supplying warehousing services, is constructing a warehouse on leasehold land, using pre-fabricated technology. According to the Applicant, it can be dismantled and reconstructed at a different location. He seeks a ruling on whether the input tax credit is admissible on the inward supplies for construction of the said warehouse. The above question is admissible under section 97(2)(d) of the CGST/WBGST Act, 2017 (hereinafter collectively called the GST Act). The Applicant declares that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apacity is not affected, such an item will not be considered to be immovable property. He refers to the apex court s judgments in Solid Correct Engineering Works [(2010) 252 ELT 481 (SC)] = 2010 (4) TMI 15 - SUPREME COURT and Sirpur Paper Mills Ltd [97 ELT 3 (SC)] = 1997 (12) TMI 109 - SUPREME COURT OF INDIA . He further submits with illustrations that the warehouse is nothing more than an assembly of the System, which is pre-fabricated and pre-engineered components, fixed together in a modular form with nuts and bolts and without welding so that it can be easily unfixed. The utility of the RCC platform on which the System is being fixed is limited to allowing the warehouse to be set up and no further. It is the System that is beneficially enjoyed, not the RCC structure. 3. Immovable property is not defined under the GST Act. The term goods is defined under Section 2(52) of the GST Act as all kinds of moveable properties other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply. Property other than goods, money ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly or under a contract for supply, it ceases to be goods and, for that matter, a moveable property. 5. In the case of Solid Correct Engineering Works (supra) that the Applicant refers to, the Apex Court, while examining whether a machine, fixed with nuts and bolts to a foundation, with no intent to permanently attach it to the earth, is an immovable property or not, has held that such an attachment without necessary intent to making it permanent cannot be an immovable property. The emphasis is on the intention of the party. The Apex Court observes that the machine in question can be moved and has indeed been moved after the road construction and repair project, for which it was installed, is completed. However, if a machine is intended to be fixed permanently to a structure embedded in the earth, the moveable character of the machine, according to the Supreme Court, becomes extinct. In Sirpur Paper Mills Ltd (1997 (12) TMI 109 - SUPREME COURT OF INDIA) the apex court has upheld the decision of the Customs, Excise and Gold Tribunal that a papermaking machine, attached to earth for operational efficiency, cannot be an immovable property merely because it is attached to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r as a pre-fabricated structure, description of the System, as the Vendor provides in the literature, does not include any specification. In a cross-sectional diagram of the typical pre-engineered steel building the Vendor provides a vivid pictorial illustration of the various parts of the structure the walls, roof, doors and windows etc. that will be built upon the floor, but does not provide any description of the floor as a pre-fabricated structure. The literature refers to wide bay purlins spanning up to 12 M for better shop floor lay out and less foundation cost. It indicates that the Vendor supplies building materials that, in his opinion, provides a more cost effective method to support the foundation for laying out the floor. It does not in any way claim that the floor itself is a pre-fabricated structure detachable from the foundation and associated civil work. In fact, the diagram showing a typical pre-engineered building does not at all include a cross-section of the floor as a prefabricated structure. It, therefore, appears that the Vendor is not supplying the floor as a pre-fabricated removable structure. The civil work undertaken is meant not only for fixing t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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