Page 42 - GSTL_23rd July 2020_Vol 38_Part 4

J100 GST LAW TIMES [ Vol. 38
• The Karnataka Authority for Advance Ruling vide Ruling
No. KAR ADRG 106/2019, dated 30-9-2019 held as follows :
(1) The input tax credit of GST can be availed by the ap-
plicant on the detachable 14 mm Engineered wood
with Oak top wooden flooring which is movable in
nature and capitalized as “furniture” and
(2) The input tax credit of GST is not available on the de-
tachable sliding and stacking glass partitions.
An appeal was filed against the above order of AAR to the AAAR
regarding detachable sliding and stacking glass partitions.
The appellant in their appeal an sought advance ruling in respect of
the following question :
(a) Whether input GST credit can be availed by the applicant on
the detachable 14 mm Engineered Wood with Oak top
Wooden Flooring which is movable in nature and capitalized
as “furniture and fixture”, and is not capitalized as “immov-
able property”?
(b) Whether input GST credit can be availed by the applicant on
the detachable sliding and stacking glass partition which is
movable in nature and capitalized as “furniture and fixture”,
and is not capitalizes as an immovable property?
(4) The issue in the appeal is limited to the point of eligibility of input
tax credit on detachable sliding and stackable glass partition. The
appellant procures these items for the purpose of creating work
spaces which are given out on rent to various companies and indi-
viduals as sharing work spaces. The detachable glass partitions are
fixed to the ground with the help of nuts and bolt and the same can
be dismantled and re-used. They had sought a ruling on the admis-
sibility of credit on the aforesaid items. The AAR denied the input
tax credit in terms of Section 17(5)(d) of the CGST Act by holding
that the detachable sliding and stackable glass partitions are fixed to
the building to create office space and amounts to construction of
immovable property; that since the expression ‘construction’ has
been defined in the said Section 17(5) to include addition and alter-
nation to the immovable property which have been capitalised in
the books of accounts they are not eligible for the input tax credit on
the abovesaid items.
(5) Section 16(1) of the CGST Act, 2017 provides as follows :
“16.(1) Every registered person shall. subject to such conditions and
restrictions as may be prescribed and in the manner specified in Sec-
tion 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”.
(6) Section 17(5)(d) reads as follows :
(5) Notwithstanding anything contained in sub-section (1) of section
16 and sub-section (1) of section 18, input tax credit shall not be avail-
able in respect of the following , namely :
(d) Goods or Services or both received by a taxable person for
construction of an immovable property (other than Plant or Ma-
GST LAW TIMES  23rd July 2020  42