The Maharashtra Authority of Advance Ruling (AAR) ruled that the Input Tax Credit (ITC) cannot be claimed for the Goods and Service Tax (GST) paid on input and input services used for the construction of the commercial property.
The applicant, M/s Ashish Arvind Hansoti is involved in the construction of immovable property for letting out to various tenants on which the GST will be charged under the heads “renting of immovable property”.
For the purposes of such construction, huge quantities of materials and other inputs were purchased by the applicant, and certain input services were also availed against which applicant has paid GST and now wants to avail credit of such GST paid by him, for discharging the output tax liability.
The applicant sought the advance ruling on the issue of whether an applicant is eligible to claim an input tax credit of GST paid on input & input services used for the construction of a commercial immovable property, subsequently used for renting.
The Authority consists of members A.A. Chahure and P. Vinitha Sekhar ruled that the Input Tax Credit (ITC) cannot be claimed for the Goods and Service Tax (GST) paid on input and input services used for the construction of the commercial property.
“We are of the opinion that since the case of M/s. Safari Retreats Pvt. Ltd. is pending with the Hon’ble Supreme Court, has not attained finality. We also find that the Hon’ble High Court has given the relief to the party invoking its writ jurisdiction while categorically holding that they are not inclined to hold Section 17(5)(d) to be ultra vires. Therefore, we are not relying upon the judgment of the Hon’ble High Court,” the AAR said.
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