The Authority of Advance Ruling (AAR) of Gujarat state ruled that the Input Tax Credit (ITC) is not available towards the GST paid on input services of Lease Premium towards which GST has been imposed.
The petitioner is the owner of JM chemicals furnished that long term lease premium gets privileged from the tax beneath Entry 41 of Notification No. 12/2017-Central Tax (Rate) on 28/06/2017 provided beneath section 11 of the GST Acts towards the grant of a lease via State Government Industrial Development Corporations or Government entities. The transferee from GIDC in which is named Ginni Filaments whose purpose is to impose GST and furnish the tax beneath the GST acts on the lease premium to be obtained via JM for the assignment of lease.
Upon the case applicant seeks advance ruling on the issue that if JM chemicals are subjected to avail the ITC of GST furnished on the input services of the lease premium filed to Ginni Filaments towards which they impose GST beneath the head miscellaneous receipt below SAC code No. 99979.
The bench consists of Sanjay Saxena and Arun Richard the GST amount carried via JM chemicals towards the service obtained is blocked credit vide Section 17(5)(d) CGST act and hence not subjected to claim towards the cause that the expression plant and machinery do not include land. In ruling at para 12 it is explained that the expression of Plant and Machinery excluding land has been started in the Blocked Credit section 17(5) CGST Act. ITC shall not be rendered for the services to land obtained through the individual subject to tax towards the construction of immovable property engaging when the same services are practised for businesses as per the legislature.
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The term used through the legislature under section 17(5) (d) CGST act is for and not used hence the purpose of the legislature was to restrict the credit towards the lease service obtained through the taxable individual towards the construction of the property that is immovable and GST official is blocked towards the concern that GST carried through the taxable individual upon these leasing is not available towards the construction of the property which is immovable.
