2020(08)LCX0143(AAR)
AAR-HARYANA
M/s Embassy Industrial Parks Private Limited
decided on 28/08/2020
HARYANA AUTHORITY FOR ADVANCE
RULING,
GOODS AND SERVICES TAX,
HARYANA VANIJYA BHAWAN, PLOT NO 1-3, SECTOR 5,
PANCHKULA-134151 (HARYANA)
Advance Ruling No. HAR/HAAR/R/2019-20/01
(In Application No. 01/2019-20, dated 01.04.2019)
Name & Address of the Applicant | : | M/s Embassy Industrial Parks Private Limited, Pathredi, Tehsil Gurugram, Gurgaon, Haryana. |
GSTIN of the Applicant | : | 06AACCJ2346P1ZB |
Date of Receipt of Application | : | 01.04.2019 |
Clause(s) of Section 97(2) of CGST/HGST Act, 2017, under which the question(s) raised. |
: | Clause (d)- admissibility of input tax credit of tax paid or deemed to have been paid. |
Date of Personal Hearing | : | 03.06.2019 |
Present for the Applicant | : | Sh. Harish Bindumadhavan (Advocate) |
Memo No.: 1041/AAR
Dated: 28/08/2020
1. Statement:
1.1 Embassy Industrial Park Private Limited (hereinafter referred to as
‘Applicant’) is a private limited company incorporated in India and registered
under Companies Act, 2013.
1.2 The Applicant has obtained GST registration for its office situated at
Pathredi, Tehsil Gurugram Gurgaon Haryana 122413.
1.3 The Applicant is inter alia engaged in building and managing
industrial warehousing spaces for consumers and industrial centers. The
Applicant is strategically located in the proximity of key commercial,
industrial and freight corridors across Maharashtra, Haryana, Tamil Nadu and
West Bengal.
1.4 The Applicant is proposing to develop a new Industrial warehouse at Pathredi,
Tehsil Gurugram, Gurgaon, Haryana 122413.
1.5 The Applicant procures various goods and services from various contractors
for fitting-out of the warehousing spaces and provides the subject space having
with all facilities and infrastructure facility on rent to various industrial
consumers and manufacturers. The Applicant discharges applicable GST on such
procurements.
1.6 Section 16(1) of Central Goods and Services Tax Act, 2017 (“CGST Act”)
entitles a registered person to take credit of input tax charged on any supply
of goods or services or both which are used or intended to be used in the course
or furtherance of business.
1.7 However, as per Section 17(5) of the CGST Act, a restriction is imposed with
respect to input tax credit (hereinafter referred to as “ITC”) on procurement of
goods and services or both received by the taxable person for construction of an
immovable property. However, the term ‘construction’ is limited to supplies to
the extent capitalized to an immovable property.
1.8 One of the types of procurements made is that of the pre-engineered
structure (“PES”).
1.9 As can be seen in the above images, a PES is a enclosure system that always
includes a structural system and often includes roof and wall cladding.
1.10 The pre-engineered metal system is advantageous because it economically
allows for the creation of large column-free enclosures.
1.11 The following are generally the primary components of a PES:
a. Primary framing consisting of rigid frames, end wall frames, bracing and
brackets;
b. Secondary framing consisting of elements which support the roof and wall
sheeting;
c. Roof sheeting; and
d. Wall cladding.
It is with respect to ITC eligibility for these items that the Applicant seeks
to obtain this ruling. The details of the question of law in Appendix 2
is ‘accordingly submitted before this Hon’ble Authority for Advance Ruling.
2. Questions:
2.1 Given the factual matrix as enunciated in Appendix 1, we wish to seek
a ruling on the following question:
2.2 Whether input GST credit can be availed by the Applicant on pre-engineered
structures which is movable in nature and accounted as “Plant and machinery” and
not capitalized as an immovable property?
3. Grounds for application/ interpretation of law in respect of which the
Advance Ruling is sought:
I. Input credit of taxes paid in respect of pre-engineered structure eligible
credit under Section 16 of the CGST Act:
3.1 Section 16 details the criteria of availment of ITC on tax paid on goods and
services.
Relevant extracts of the same have been reproduced as follows:
“(1) Every registered person shall, subject to such conditions and
restrictions as may be prescribed and in the manner specified in section 49, be
entitled to take credit of input tax charged on any supply of goods or services
or both to him which are used or intended to be used in the course or
furtherance of his business and the said amount shall be credited to the
electronic credit ledger of such person………………”
3.2 Thus, from a bare reading of the Section, it can be seen that Section 16 of
the CGST Act entitles every registered person to take input tax credit of tax
charged on supply of goods or services or both which are used or intended to be
used in course or furtherance of business.
3.3 The above criteria for availment of credit is broad both in manner as well
as intent.
Meaning of “in the course of” or “furtherance of business”
3.4 While business has been defined under the CGST Act, the terms “in the
course” “or furtherance of business” are not defined anywhere under the CGST
Act or the CGST Rules made thereunder.
3.5 In the course of generally means something “in the progress of process
of”.
3.6 The meaning of “Furtherance” as per Black’s law dictionary: 6th
edition 11th reprint 1997, is “act of furthering, helping forward, promotion,
advancement or progress”.
3.7 Furtherance of business will, thus mean, act of furthering business, helping
forward business, promotion of business, advancement of business or progress of
business.
3.8 As mentioned above, the Applicant is into the business of building and
managing industrial warehousing spaces for consumers and industrial centres and
PESs helps in giving value add to its Industrial customers and managing the
Industrial spaces in more efficient and effective way. In other words, the
subject civil works helps the Applicant in carrying out their business in their
day to day operations.
3.9 Therefore, basis the above submissions, given that the Applicant procures
PES works which are erected in warehousing spaces rented out by the Applicant,
the condition as provided under Section 16 for availment of ITC stands
satisfied.
II. Restriction provided under Section 17(5) (c) & (d) does not apply to
procurement of items for PESs:
Credit restriction is only in so far as inputs/ input services “for
construction of an immovable property”
3.10 Section 17(5)(d) uses the word “for” construction.
3.11 The term “for” is more specific than “in relation to”. The word “for”
generally means “for the purpose of”.
3.12 The word ‘for’ is defined in the Concise Oxford English Dictionary, 8th Ed.
as under:
a) “in the interest or to the benefit of; intended to go to;
b) in defence, support or favour of;
c) suitable or appropriate to;
d) in respect of or with reference to;
e) representing or in place of….
f) conducive or conductively to; in order to achieve…”
3.13 The Hon’ble Supreme Court in the case of Mansukhlal Dhanraj Jain & Ors.
Etc. v. Eknath Vithal Ogale etc. compared the words “for” and “relating to”
and concluded that the latter has wider connotations than the former. The
relevant extract is reproduced for your reference:
“There is a good deal of difference between the words “relating to the
recovery of possession” on the one hand and the terminology 7or recovery of
possession of any immovable property”. The words “relating to” are of wide
import and can take in their sweep any suit in which the grievance is made that
the defendant is threatening to illegally recover possession from licensee.”
3.14 It can be seen from the above decisions that the word ‘for’ has been
defined to mean in the interest of, to the benefit of, in defence of, in support
or favour of, etc. Based on the above rationale, it can therefore be concluded
that in order to be covered by the restrictions provided under Section 17(5)(d),
the goods or services must be used directly for construction of immovable
property.
3.15 In other words, with reference to section 17(5)(d) of CGST Act, read with
the explanations provided therein, credit eligibility of goods or services or
both is restricted only when the same is “for construction of an immovable
property”.
3.16 Further, the Applicant wishes to submit that for the purposes of clause (d)
of section 17(5) of CGST Act, the expression ‘construction’ has been defined to
include re-construction, renovation, additions or alterations or repairs, to the
extent of capitalization of the said immovable property.
3.17 The Applicant in this regard submits that, so far the business activity of
the applicant is concerned, PESs are not capitalised as immovable property but
are in fact recorded as ‘plant and machinery’.
3.18 They can be detached and re-used and are not considered to be the permanent
civil assets. It is for this very reason that these items are not capitalized as
immovable property.
3.19 Thus, PESs are not covered under the definition of ‘construction’ and
consequently is not restricted under Section 17(5).
4. PESs qualify as eligible credit under Section 16 of the CGST Act,
Restriction provided under Section 17(5)(d) does not apply:
4.1 Basis the above submissions regarding the admissibility of the credit for
works relating to PESs, the Applicant wishes to reiterate the analysis above as
they same shall be applicable in the case of PESs as well.
4.2 The Applicant submits that as per Section 16 of the CGST Act, he is eligible
to avail credit on such PESs as the same are used in the course or furtherance
of Applicant’s business.
4.3 It is pertinent to note that the restriction prescribed in Section 17(5)
pertains to as inputs/ input services “for construction of an immovable
property”.
5. Goods in question are movable:
5.1 The Applicant submits that anything embedded to the earth and which cannot
be dismantled and moved, strictly are covered under the ambit of “immovable
property”, thus restricting the same from availment of ITC as per Section 17
(5)(c) & (d) of the CGST Act.
5.2 The term immovable property has not been defined under GST Act, therefore
reference needs to be taken from General Clauses Act, 1897.
5.3 Section 3(26) of the General Clauses Act, 1897, does not provide an
exhaustive definition of the said expression. It reads :
“immovable property” shall include land, benefits to arise out of land, and
things attached to the earth, or permanently fastened to anything attached to
the earth.”
5.4 Similarly, Section 3 of the Transfer of Property Act, 1882 does not spell
out an exhaustive definition of the expression “immovable property”. It simply
provides that unless there is something repugnant in the subject or context
‘immovable property’ under the Transfer of Property Act, 1882
5.5 Though the terms “attached to the earth” are not defined in the GST law,
reference can be drawn Section 3 of the Transfer of Property Act, 1882 wherein
it is defined that anything:
a) Rooted to the earth, as in case of trees and shrubs;
b) Imbedded in the earth, as in the case of walls and buildings;
c) Attached to what is so imbedded for the permanent beneficial enjoyment of
that to which it is attached.
5.6 PESs are basically steel structures consisting of columns, roof truss,
purlins etc. that are pre-fabricated in a factory in accordance with design
specifications and later erected in site using bolts.
5.7 These are tailor made based on client’s requirements and actual design
calculations.
5.8 Designing and fabrication is done in factory. Building components are
brought to site and then joined at the site. All connections are bolted.
6. Erection:
6.1 The steel structures are lifted into place by crane and then bolted together
Below is an image of PES under installation.
7. Foundation:
7.1 Foundation for PESs are made with conventional concrete systems, usually
open foundations. These structures are very light (they can weigh as little as
50 kg per square meter, excluding the foundations and floor slab), the
foundations are designed to firmly anchor the structure to ground preventing
them from being blown away by the wind. The slab provides a strong and stable
base for the foundation and avoids direct contact of the foundation with soil.
As seen above, PES foundation slab merely rests on the ground and are not
imbedded in the earth. Therefore they cannot be classified as “immovable
property” as described above.
7.2 Pre-engineered structures are different from that of conventional concrete
buildings. They are often preferred as they are more efficient and effective as
compared to concrete structures. Analysis of same has been brought out below:-
Feature |
Pre-Engineered Steel Structures (PES) |
Concrete Buildings (RCC) |
Capacity | Steel may carry up to 6 times its own weight. | The carried load of concrete is almost equal to its weight |
Erection | Easy, fast and efficient. Erection costs and time are accurately forecast based on extensive experience with similar buildings. | Concrete construction takes more time to complete because it must be poured on site and allowed to cure before proceeding. |
Clear Spans | Larger, up to 90 meters without interior columns. | Smaller and the larger the span the heavier the structure. |
Building Height | Higher | Shorter |
Changes | Flexible, tailor-made, changes and revisions can be made easily. Future expansion is simple, easy and cost-effective. One supplier to coordinate changes. | It is nearly impossible to modify a concrete building to meet changing future needs. To expand the structure, the contractor must build a new structure with foundations, columns and most likely must break part of the old structure. |
Applications most beneficial to | Industrial and Commercial. | Houses, Villas, and Parliaments |
Cost | Overall cost is generally less and accurately defined and forecast. | Overall cost could be higher and is difficult to accurately define and forecast. |
Fabrication | Done in shop-controlled conditions. | Mostly at site in variable conditions. |
Material Specifications | Precise and fixed, carefully and accurately controlled under supervision in the production facility. | Variable, non-homogeneous. The properties of concrete vary widely due to variations in its proportioning and mixing. |
Dimensions | Precise and accurate measurements carried out by automated machines. | Potential for significant errors as most of the work is man made on site. |
Material Foundations | Lighter, simple design and easy to construct. | Variable and generally require extensive heavy foundations. |
7.3 There are a number of
advantages associated with adopting PESs by any industry. Some of them are
listed below:-
a) PESs are joined together using bolts which allows expansions, which may be
required in the future, to be done in a cost effective and simple manner.
b) PESs are architecturally versatile since designs can be developed in software
and the structure can be fabricated using machines to achieve the desired shape
without any compromise.
c) The structure is light in weight and flexible enough to offer greater
resistance when compared to conventional concrete structures.
d) It also requires less manpower at site and results in reduction/saving in
cost to company.
e) The process eliminates multiple parties to streamline construction and save
time and money.
7.4 Therefore, it can be summarized that:-
a) PESs are pre-fabricated structures that are erected in the site and joined
together using bolts. They are not inextricably linked to the construction
itself.
b) The foundation is a slab which rests on the ground and neither rooted to the
earth not embedded in the earth nor attached for the permanent beneficial
enjoyment as the same can be detached and reused at another site.
c) It is adopted to meet business requirements efficiently and effectively and
hence it is in the course or in the furtherance of business.
8. Inapplicability of the decision of the West Bengal Authority for
Advance Ruling in the case of Tewari Warehousing:
8.1 In the Advance Ruling issued by the authority for Advance Ruling, West
Bengal, in the case of M/s. Tewari Warehousing Co Private Limited, the
question was whether the applicant is eligible for input tax credit pertaining
to construction of warehouse using pre-fabricated technology.
8.2 The Authority reasoned that if the article cannot be used without fastening
or attaching it to the earth and is not removed under ordinary circumstances, it
may be considered permanently fastened to anything attached to the earth.
8.3 Furthermore, in the context of the GST Act, if the article attached to the
earth is not agreed to be severed before supply or under a contract for supply,
it ceases to be goods and, for that matter, a moveable property.
8.4 The Authority opined that the pre-fabricated movable structures do not
constitute the property of the warehouse. They are building blocks applied to a
civil structure attached to the land to construct a complete warehouse. The
warehouse cannot be conceived without the beneficial enjoyment of the civil
structure, which is an integral part of the property. On this basis, warehouse
being constructed was classified as an “immovable property” and credit was not
admissible on inward supplies pertaining to PES technology.
8.5 However, on analysing the above decision, the Applicant submits that the
above decision cannot be relied upon and the same has to be distinguished based
on factual grounds:
a) The Authority has assumed that the most important component of a warehouse is
the floor on which the goods will be kept. However, this is not in the case of
the Applicant as warehousing provided by them is not just for storing goods but
also involves protecting the goods from sunlight, rain, wind and other forces of
the external environment.
b) Only a comprehensive structure consisting of walls and roof can safeguard the
goods being warehoused. The beneficial enjoyment of the PES structure is of
paramount importance and the concrete base only plays a supportive role. Whereas
ITC relating to the concrete base is clearly ineligible, the ITC pertaining to
PES structure should be available and that is what the question pertaining to in
the Application.
c) Further, the Authority has also assumed that the intention of the Applicant
is to make the PES as a permanent structure. However, the very reason why PES is
preferred over conventional building is that it offers movability. Hence, when a
PES is assembled in a place, the intention is definitely not to make it a
permanent structure but rather to facilitate hassle-free shifting based on
changing business requirements.
d) The Authority has also held the PES warehouse cannot be relocated by unfixing
the pre-fabricated structures alone and that dismantling of the floor is
necessary. However, in reality the entire structure can be dismantled without
any damage to its components and can be reassembled at another location without
any need to dismantle the floor of the previous location.
9. Judicial Precedents in relation to credit admissibility:
9.1 In the Advance Ruling issued by the authority for Advance Ruling,
Uttarakhand, in the case of M/s VINDHYA TELELINKS LTD, the question was
whether the applicant is eligible for input tax credit on goods & services used
in erection of infrastructure, which consists of “steel tabular pole, galvanized
iron wire, nuts &, bolts, optical fibre cables, plastic pipes, clamps”, for
telecommunication service providers since the infrastructure provided by the
applicant is different from “Telecommunication Tower”.
9.2 It was held that the infrastructure provided by the applicant is different
from “Telecommunication Tower” and it is not an immovable property as it can be
easily be moved to another place for use without any damage to the entire
infrastructure.
The infrastructure being a movable property can be classified as ‘goods’ in
terms of section 2(52) of CGST/SGST Act, 2017. The infrastructure provided being
different from Telecommunication Tower, the applicant can avail Input Tax Credit
on GST paid on the goods & services in terms of section 16(1) of CGST/SGST Act,
2017, consumed while providing the supply in question.
9.3 As mentioned in the facts of the case, PES are movable in nature and thus
applying the decision of the Advance Ruling Authority, the Applicant would
9.4 In view of the above, on applying three test referred above, PES cannot be
termed as immovable property for the following reasons:
a) They are not immovable property;
b) They cannot be said to be attached to earth;
c) The setting up itself is not intended to be permanent at a given place.
d) It can be moved based on business requirements.
9.5 The Applicant further places reliance on the advance ruling issued by the
Authority of the advance ruling in the case of M/s BAHL Paper Mills LTD,
where the question was whether credit will be available on office fixtures &
furniture, AC, plant & sanitary fittings on the newly constructed building on
its own account, for furtherance of business, and is capitalized in books of
accounts.
9.6 It was held that as per the explanation to Section 17 of the CGST Act,
availment of credit was not admissible in respect of land, building or any civil
structure; therefore sanitary fittings being the integral part of the land was
not an admissible credit.
9.7 However, credit of GST is available on office fixtures & furniture, A.C.
plant. The said advance ruling has placed reliance on the CBIC Board Circular
No. 943/04/2011-CX dated 29th April 2011 wherein it was clarified that the goods
such as furniture and stationery used in an office within the factory are goods
used in the factory and are used in relation to the manufacturing business and
hence the credit of the same is allowed.
9.8 Further Reliance can be placed on the judgement in the case of M/s
Balkrishna Industries Ltd Vs CCE, Jaipur-I wherein it has held that the
credit on duty paid on air-conditioners installed in the office of factory is
admissible. Further, the goods such as furniture and stationery used in the
office within the factory are goods used in relation to the manufacturing
business and hence credit is to be allowed on the same.
9.9 The Applicant further places reliance on the Advance ruling issued by the
Authority of the advance ruling in the case of Nipro India Corporation
Private Limited where the question was whether the input tax credit of tax
paid on cost proposed to be incurred in relation to civil works, mechanical
works and electrical works can be admissible under the CGST Act,2017.
9.10 It was held that the goods in question are used or intended to be used in
course of furtherance is business and as per section 16 of the GST Act “Every
registered person subject to such conditions and restrictions as may be
prescribed would be entitled to take credit of input tax charged on supply of
goods or services or both to him which are used or intended to be used in course
or furtherance of business”.
9.11 Further it is understood that credit with respect to various plant and
machinery is admissible as per Section 16 of the CGST Act.
9.12 From the above, it can be inferred that the credit of input tax charged on
the supply in the nature of various plant and machinery items are to be allowed
as it is admissible under CGST/SGST Act 2017.
9.13 Thus, the Applicant submits that with reference to the explanation provided
in section 17(5)(d) of CGST Act, the goods in question i.e., PES which are in
the nature of supporting civil works are movable fit-outs which would qualify as
eligible input tax credit.
10. Discussion:
10.1 The applicant is engaged in building and managing industrial and
warehousing spacing for consumers and industrial Centre. It procure goods and
services from various contractor for fitting out the warehousing spaces and
provides subject space and infrastructure facility on rent to various industrial
consumers and manufactures. It discharges the GST liability with regard to such
procurement. One of the types of procurement is pre-engineered structure (PES).
The applicant also submitted that the PES are not capitalized as immovable
property but are recorded as plant and machinery. They can be detached and
reused in are not considered to be permanent civil affects. The PES are
pre-fabricated structures that are erected at the site by way of joining to
bolts. The foundation is made of concrete and it rests on the earth, neither
rooted to nor embedded in the earth for permanent beneficial enjoyment. The
applicant seeks ruling with regard to the availability of Input Tax Credit
against the procurement of PES.
10.2 Dealing with the contention of the applicant, it is important to discuss
some of the relevant provisions contained in the CGST/ HGST Act, 2017. Section
2(52) defines goods as “every kind of movable property 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”.
10.3 Section 16(a) of the Act provides for eligibility of Input Tax Credit. It
reads as “in possession of a tax invoice or debit note issued by a
supplier registered under this Act, or such other tax paying documents as may be
prescribed”.
10.4 Section 17 of the GST Act deals with Apportionment of credit and blocked
credits. Section 17(5)(d) reads as “goods or 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”.
10.5 Now, as per the definition of goods some movable property is excluded from
the category of goods whereas at the same time, some immovable properties are
treated as goods. But the terms movable and immovable property have not been
defined under the GST Act. In laymen terms, any goods that can moved is a
movable property and which cannot be moved is immovable property.
10.6 But the General Clauses Act 1897 and the Transfer of Property Act defines
both these terms. Section 3(26) of the General Clauses Act says:
“immovable property” shall include land, benefits to arise out of land, and
things attached to the earth, or permanently fastened to anything attached to
the earth”. Whereas, Section 3(36) defines movable property as
“property of every description, except immovable property”. So as per
this definition, any property which does not qualify to be immovable property,
is a movable property. This definition of immovable property under the General
Clauses Act is affirmative in nature as against the definition contained in the
Transfer of the property Act 1882, which is negative in nature. As per TPA,
immovable property does not include standing timber, growing crops or grass. It
further says that “attached to the earth” means:
(a) rooted in the earth, as in the case of trees and shrubs;
(b) imbedded in the earth, as in the case of walls or buildings; or
(c) attached to what is so imbedded for the permanent beneficial enjoyment of
that to which it is attached.
10.7 Now, section 17(5)(d) bars any taxpayer to avail the benefit of Input Tax
Credit in case where the goods or services or both received by the said person
are used for the construction of an immovable property even if it is in the
course or furtherance of business.
10.8 As per the definition of immovable property contained in the General
Clauses Act and the Transfer of Property Act, it is clear that things attached
to the earth or permanently fastened to anything attached to the earth is
immovable property. Anything imbedded in the earth or attached to what is so
imbedded for the permanent beneficial enjoyment of that to which it is attached,
qualifies to be attached to the earth.
10.9 As far as the contention of the applicant regarding procurement of PES and
subsequent fitting to be in the course of business is concerned, it is admitted
that the same is in course of business but the question is whether the applicant
is eligible to ITC in light of the provisions contained in section 17(5)(d) of
the CGST/ HGST Act. The applicant shall be eligible to ITC only if it is so
established that the property i.e. warehouse constructed/ erected by way of PES
qualifies to be movable property.
10.10 The Supreme Court in Triveni Engineering and Industry Limited (2000) case
observed that in order to determine whether an article is permanently fastened
to anything attached to the earth, both the intention as well as the factum of
fastening has to be ascertained from the facts and circumstances of each case.
The English Law also attaches great significance to the degree and nature of
annexation. The Allahabad High Court in S/S Triveni N L Limited has observed
that “permanently fastened to anything attached to the earth” has to be read in
the context for the reason that nothing can be fastened to the earth permanently
so that it can never be removed. If the article cannot be used without fastening
or attaching it to the earth and it is not removed under ordinary circumstances,
it may be considered permanently fastened to anything attached to the earth. The
applicant has submitted that the concretionary foundation rests on earth it is
neither attached to nor imbedded in the earth. But the contention of the
applicant is rejected because since the concretionary structure rests on the
earth, it is naturally attached to the earth by way of gravitational pull of the
earth.
10.11 Further, when any object is said to be imbedded in earth, it does not mean
that a part of it is to be inserted/ put deep beneath the earth by digging the
earth for several meters. For laying any foundation especially in case of area
of considerable dimension as in case of a warehouse, the top soil has to be
removed, surface has to be leveled and some part of foundation stone always
rests with in the earth. So this contention of the applicant that the support
base of the warehouse made of PES neither attached to nor imbedded in the earth
is rejected.
10.12 As regards the issue of the non-permanent nature of the PES structure is
concerned, it has already been discussed that the degree and nature of
annexation is vital to the decision whether a property is a movable property or
an immovable property. In the case of applicant, the warehouses are rented out
to industrial consumers and manufacturers. These warehouses cover considerably
large area and caters to the need of business which in terms requires permanence
and stability. So, it cannot be said that the warehouses constructed/ erected by
way of fixing pre-engineered structures is non-permanent in nature.
11. Ruling:
11.1 In light of the above discussion it is concluded that the warehouses
constructed/ erected by the applicant are an immovable property for the purposes
of GST Law and the applicant is not eligible to ITC in view of the provisions
contained in section 17(5)(d).
Ordered accordingly.
To be communicated.
18.06.2019
Panchkula.
(Sangeeta Karmakar)
Member (CGST)
(Madhubala)
Member (SGST)
Regd. AD/Speed Post
M/s Embassy Industrial Parks Private Limited, Pathredi, Tehsil Gurugram, Gurgaon, Haryana.
Copy to:
1. The Principal Commissioner of
Central Goods & Service Tax, GST Bhawan, Plot No. 36-37, Sector-32, Gurugram,
Haryana.
2. Deputy Excise and Taxation Commissioner (ST), Gurugram (North).
Equivalent .