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TMI Blog2024 (1) TMI 659X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The applicant further submits that their business of manufacturing and sale of welding wires from their manufacturing plant in Anand, constitutes 'business' as per section 2(17) of the CGST Act, 2017; that in terms of section 16( 1), ibid, they are eligible for the benefit of ITC [input tax credit] on any supply of good or services which are used or intended to be used in the course of furtherance of business. 4. Further relying on sections 2(63), 2(59), 16 and 17 of the CGST Act, 2017, the applicant submits that they are eligible for ITC on the inputs, input services & capital goods used for erection, commissioning and installation of roof top solar power plant. 5. In light of the foregoing submissions, the applicant has sought advance ruling on the below mentioned question viz 1. Whether the applicant is eligible to take ITC as 'inputs/capital goods' or 'input services' on the purchased rooftop solar system with installation & commissioning in terms of sections 16 & 1 7 of the CGST/GGST/IGST Act? 2. Whether the rooftop solar system with installation and commissioning constitute plant and machinery of the applicant which are used in the business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce to the CGST Act would also mean a reference to the same provisions under the GGST Act. 9. We have considered the submissions made by the applicant in their application for advance ruling as well as the submissions made during the course of personal hearing. We have also considered the issue involved, the relevant facts & the applicant's submission/interpretation of law in respect of question on which the advance ruling is sought. 10. Before dealing with to the submissions made by the applicant, we would like to reproduce the relevant sections for ease of reference: CENTRAL GOODS AND SERVICES ACT, 2017 [relevant extracts] * Section 2. Definitions.- (17) "business" includes - (a) any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit: (b) any activity or transaction in connection with or incidental or ancillary to sub-clause (a): (c) any activity or transaction in the nature of sub-clause (a), whether or not there is volume, frequency, continuity or regularity of such transaction; (d) supply or acquisition of goods including capital goods and services in connection wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise; (ii) where the services are provided by the supplier to any person on the direction of and on account of such registered person; (ba) the details of input tax credit in respect of the said supply communicated to such registered person under section 38 has not been restricted; (c) subject to the provisions of section 4, tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilisation of input tax credit admissible in respect of the said supply; and (d) he has furnished the return under section 39; Provided that where the goods against an invoice are received in lots or instalments, the registered person shall be entitled to take credit upon receipt of the last lot or instalment: Provided further that where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business. Explanation.-For the purposes of clauses (c) and (d), the expression "construction" includes re-construction, renovation, additions or alterations or repairs, to the extent of capitalisation, to the said immovable property: (e) .......; (f) ......: (g) .......: (h) .........; and (i) .............. (6) The Government may prescribe the manner in which the credit referred to in subsections (1) and (2) may he attributed. Explanation - For the purposes of this Chapter and Chapter VI, the expression "plant and machinery" means apparatus, equipment, and machinery fixed to earth by foundation or structural support that are used for making outward supply of goods or services or both and includes such foundation and structural supports but excludes- (i) land, building or any other civil structures: (ii) telecommunication towers: and (iii) pipelines laid outside the factory premises. 11. For case of understanding it would be prudent to reproduce the relevant extracts from the letter dated 17.3.23023 of Addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xtracts of the inter-connection agreement signed with MGVCL for roof top solar plant states as follows viz This Agreement is made and entered into at (location) Vadodara on this (date) 14th day of (month) March (year) 2023 between the Consumer, by the name of M/S UNIQUE WELDING PRODUCTS PVT LTD. Consumer Number 15453 having premises at (address) PLOT NO. 701/B. GIDC, IV" PHASE V. U. NAGAR-388121 (hereinafter 'referred to as "Consumer" which expression shall include its permitted assigns and successors) as first party AND Madhya Gujarat Vij Company Limited, a Company registered under the Companies Act 1956/2013 and functioning as the "Distribution company" or "DISCOM" under the Electricity Act 2003 having its Head Office at Sardar Patel Vidyut Bhavan, Race Course, Vadodara (hereinafter referred to as "MGVCL" or "Distribution Licensee" or "DISCOM" which expression shall include its permitted assigns and successors) a Party of the Second Part. The solar project of M/s UNIQUE WELDING PRODUCTS PVT. LTD., has been registered by the Gujarat Energy Development Agency (i.e. GEDA) vide letter No. GUJ/RT/HT /10103600 did. 20-Feb-2023 to set up Photovoltaic (PV) based Solar Power G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat they will be installing a Roof Solar Plant on its factory roof to generate electricity which will be solely and captively used for manufacture of welding wires within the same premise. 14. We have reproduced the relevant extracts of the approval letter issued by Madhya Gujarat Vij Company Limited and copy of inter connection agreement signed with MGVCL for roof top solar plant. 15. The photographs depicting the roof top solar plant as submitted by the applicant in his additional submission is scanned and reproduced below for the ease of reference. 16. Further, the treatment of the roof top solar plant in the books of account of the applicant, as depicted in the Balance sheet as on 31.3.2022 is as under (Scanned copy for ease of reference] 17. It is therefore, clear that the roof solar plant, affixed on the root of the building is not embedded to earth. Accordingly it is not an immovable property but a plant and machinery, which is utilized to generate electricity which is further solely and captively used in the manufacture of welding wires. The applicant is engaged in the business of supply of welding wires on payment of GST at the applicable rates. The applicant has furth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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