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TMI Blog2020 (8) TMI 906X X X X Extracts X X X X X X X X Extracts X X X X ..... e course or furtherance of business. The definition of immovable property is not provided under GST Act. According to section 3(26) of the General Clauses Act, 1882, 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 . According to section 3 of the Transfer of Property Act, 1882, Immovable property means Immovable property does not include standing timber, growing crops or grass - It is undisputed as per the submissions of appellant as well as from the Order of AAR that appellant intends to construct building / warehouse which is immovable property. Appellant never segregated construction from maintenance but rather has used only comprehensive phrase Construction and Maintenance . He has never spelt out accounting treatment of inward supply of goods or services or both received by him for construction of an immovable property. The explanation appended at the end of sub-section allows ITC to the extent it is not capitalised. Capitalisation or Non-capitalisation of these expenses is certainly not a permanent indelible mark in the account books. These accounting entries may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). The revenue from operation of the firm consists of the following: 1. C&F Commission 2. Warehouse Rent 3. Other reimbursement Freight etc. QUESTIONS RAISED BEFORE AUTHORITY FOR ADVANCE RULING (AAR) Questions raised before AAR, are as under: - 1. Whether ITC of GST paid on goods purchased for the purpose of construction & 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 Work contract service received from registered & unregistered Contractor for construction & maintenance contract of building can be claimed in full? 3. Whether ITC of GST paid on goods purchased & works contract service received during the FY 2017-18 for the purpose of construction & maintenance of Warehouse can be claimed in full? RULLING PRONOUNCED BY AUTHORITY FOR ADVANCE RULING (AAR) 1. We hold that no ITC of GST paid on goods purchased for the purpose of construction & maintenance of warehouse such as Vitrified Tiles, Marble, Granite, ACP Sheet, Steel Plates, TMT Tor (Saria), Bricks, Cement, Paint and other construction materialis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the case by not allowing the ITC on the goods and services used for maintenance of warehouse and cost of which is booked as revenue expenditure in Profit and Loss account and is not capitalized in the cost of warehouse and the same has not been covered by way of explanation to section 17(5)(d) of the CGST Act, 2017. PERSONAL HEARING The appellant was issued notice for personal hearing to appear on 22.07.2020 and 25.08.2020 but he kept on asking for adjournment despite being offered hearing through Google Meet. The case is being decided as per written submissions on merit. DISCUSSION AND FINDINGS 1. We have carefully gone through the application of the Appellant. 2. Appellant as explained by him either intends to construct or but for his personal appearance, might have already constructed the warehouse / building for letting it out on rent to companies whose goods would be stored therein. 3. The appellant as per questions posed before AAR as well as before us in the appeal against AAR, intends to either purchase goods (inward supply) as per question 1 or wants to receive inward supply of works contract services from contractors for the construction of warehouse / building ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of this principle / provision in the Law. Appellant has not elaborated his statement but for his absence hence, the argument is rejected. Appellant has next, argued that disallowance of ITC of GST paid on inputs would result in cascading effect of multi -state taxation which is opposed to the basic rationale of GST itself. Again, the statement has not been substantiated. 11. In last and final argument the appellant has put forth that AAR has erred by not allowing the ITC on the goods and services used for maintenance of warehouse and cost of which is booked as revenue expenditure in Profit and Loss account and is not capitalised in the cost of warehouse and the same has not been covered by way of explanation to section 17 (5) (d) of the GST Act. 12. Appellant in his all the three questions has not put forth such a question. He has never segregated construction from maintenance but rather has used only comprehensive phrase "Construction and Maintenance". He has never spelt out accounting treatment of inward supply of goods or services or both received by him for construction of an immovable property. The explanation appended at the end of sub-section allows ITC to the extent it ..... X X X X Extracts X X X X X X X X Extracts X X X X
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