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TMI Blog2021 (8) TMI 730X X X X Extracts X X X X X X X X Extracts X X X X ..... d to as INOX or the applicant). The applicant has sought Advance Ruling on: Whether INOX would be entitled to avail and utilize ITC of GST Charged by IPL if such transaction is considered to be a supply The Applicant has submitted the copy of application in Form GST ARA - 01 and also submitted a copy of Challan evidencing payment of application fees of Rs. 5,000/- each under sub-rule (1) of Rule 104 of CGST rules 2017 and SGST Rules 2017. 2.1 The applicant has stated that they are engaged in the business of manufacture and supply of industrial & Medical gases, including oxygen (both Industrial & Medical Grade), nitrogen, argon etc (in both liquid and gaseous form).; State Industrial Promotion Corporation of Tamilnadu (hereinafter referred as SIPCOT) had entered into an agreement dated 22.07.1993 with India Pistons Limited (hereinafter referred to as IPL) for lease of an area of land in Hosur for a period of 99 years for the purpose of setting up a piston manufacturing industry.; INOX had approached IPL for transfer of the leasehold rights for the remainder period of 72 years in respect of part of the property for setting up of State-of-the-art medical and industrial gases plan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id provision carves out a specific exception for construction of 'Plant and Machinery'. ; test of movability/immovability is immaterial to determine the eligibility of ITC once the items in question qualify as 'Plant and machinery'; As ASU is used for manufacture and supply of industrial gases by them, it qualifies as a 'Plant and Machinery'; ASU once fully constructed, will be capitalized as a 'Plant and machinery' in their Books of Accounts; ASU does not result in construction of any land, building, civil structure and it is also not a telecommunication tower or pipeline, hence do not fall under any of the exclusion category stipulated under the definition of 'Plant and machinery'; As ASU qualifies as a 'Plant and machinery', GST chargeable, if any, of transfer of leasehold rights is rightly admissible to them as the bar placed under Section 17(5)(d) of the CGST Act do not apply in a case where goods and/or services are procured for construction of a 'Plant and machinery'. 3. Due to the prevailing PANDEMIC situation and in order not to delay the proceedings, the applicant was addressed through the Email Address mentioned in the application to seek their willingness to participat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansaction is considered to be a supply The question raised as above requires ruling as to whether the applicant is eligible to avail Input Tax Credit of GST Paid on the supply received by them. The question raised is within the ambit of this authority as per Section 95/97(2) of GST Act and therefore the application is admitted. 7.1 From the facts of the case as available before us, it is seen that INOX had approached IPL to part with the leasehold and facilitate transfer of un-utilized portion of the allocated land to the extent of 5.00 acres, the leasehold of which was held by IPL, for setting up a state of the art Ultra High Purity Cryogenic Liquid Medical and Industrial Oxygen Plant. A Memorandum of Understanding (MOU) has been entered into between IPL and INOX on 20.11.2020 enabling transfer of leasehold rights for the remaining period of lease from IPL to INOX subject to the approval of SIPCOT in respect of the land measuring 5.00 acres. The applicant claims that if the supply made by IPL to them is a taxable supply, they would be eligible to avail the tax paid as Input tax Credit. Their contention are that,- * they are setting-up an ASU Plant on the leased property to ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts and which are intended to be used in the course or furtherance of business; * Credit of tax paid on goods and services received is eligible as credit when such goods or services are used in the course or furtherance of business; * Credit of tax paid on goods or services received on own account, for construction of immovable property is available only when such immovable property is a 'Plant and Machinery' * Plant and Machinery,- * are apparatus, equipment, machinery fixed to earth by foundation or structural support; * are that which are used for making outward supply of goods or services; * includes such foundation and structural supports; * excludes land, building or any other civil structures; 7.4 In the case at hand, it is seen that INOX had paid 'consideration' to IPL, for agreeing to part with their rights in the leasehold held by IPL, on the land required by the applicant. IPL had consented against such consideration and applied for withdrawing the leasehold held by them in favour of the applicant and on approval by SIPCOT, the applicant has entered into a lease agreement with SIPCOT on payment of necessary charges as required and acquired the leasehold ri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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