Page 30 - GSTL_3rd September 2020_Vol 40_Part 1

J12 GST LAW TIMES [ Vol. 40

ADMISSIBILITY OF ITC — CONSTRUC-
TION OF WAREHOUSE FOR LETTING OUT
— A CASE STUDY
ADMISSIBILITY OF ITC — CONSTRUCTION OF WAREHOUSE FOR LETTING OUT
By
Ramesh Chandra Jena, B.A. (Hons.), M.A. (Eco.),
D.M.M., LL.B.
ADVOCATE & TAX CONSULTANT

Admissibility of ITC prescribes under Section 16
of the CGST Act, 2017, which laid down four conditions
should be satisfied by a registered person in order to avail input tax credit
charged on goods and services, which are used or intended to be used in the
course or furtherance of business. Similarly, Section 17 of the CGST Act, 2017
prescribes apportionment of credit and blocked credits of ITC on certain situa-
tions, even if a registered person used goods and services in the furtherance of
business.
As per the provisions under GST law, every registered person shall be
entitled to take ITC charged on any supply of goods or services which are used
or intended to be used in the course or furtherance of his business. Moot ques-
tion arises. Whether ITC paid on goods or services used for the purpose of con-
struction of warehouse for letting out is admissible? The said question is an-
swered by Authority for Advance Ruling as follows :
Advance Ruling
In Re : Unity Traders, reported in 2020 (35) G.S.T.L. 231 (A.A.R. - GST -
M.P.) vide Order No. 6/2020, dated 10-2-2020.
Brief facts
The applicant is a partnership firm engaged in providing clearing and
forwarding agent service. As a C & F Agent, the firm stores goods of other com-
pany and charges rent for the same. The applicant raised the following questions
before the Authority :
(1) Whether ITC of GST paid on goods purchased for the purpose of
construction and maintenance of warehouse such as Vitrified Tiles,
Marble, Granite, ACP sheet, Steel Plates, TMT Tor (saria), Bricks,
Cement, Paint and other construction material can be claimed in
full?
(2) Whether ITC of GST paid on works contract service received from
registered and unregistered contractor for construction and mainte-
nance contract of building can be claimed in full?
(3) Whether ITC of GST paid on goods purchased and works contract
service received during the FY 2017-18 for the purpose of construc-
tion and maintenance of warehouse can be claimed in full?
Contention of the appellant
(i) That the firm being a taxable person is liable to pay CGST as well as
SGST in respect of the rent realized from warehouse. Therefore in

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