2020 (3) TMI 893 - AAR - GST

Advance ruling denied on input tax credit for renting property due to pending Supreme Court appeal

The application seeking an advance ruling on the eligibility of input tax credit for inputs related to renting immovable property was rejected by the ... Summary order. Application for advance ruling rejected under Section 98(2) as the question on availability of input tax credit is sub-judice before the Hon'ble Supreme Court. Issues:Eligibility to claim input tax credit on inputs attributable to the renting of immovable property.Analysis:1. The applicant, engaged in renting immovable property, sought an advance ruling on input tax credit eligibility for related inputs. They argued that denial of ITC for property meant to be let out is arbitrary, violating GST principles and constitutional rights.2. The applicant referenced CGST Act sections on input tax credit and claimed that restrictions under Section 17(5) don't apply to their case. They relied on a High Court decision to support their stance on ITC entitlement.3. The Authority considered the applicant's submissions and the legal provisions. Noting the similarity between CGST and KGST Acts, they acknowledged the applicant's business activities and input procurement for immovable property.4. Despite the applicant's reliance on the Orissa High Court decision, the Authority highlighted that the issue is sub-judice as the Department has appealed to the Supreme Court. Due to the pending status of the matter, the Authority rejected the application under Section 98(2) of the CGST Act 2017.5. The ruling concluded that the application is rejected because the issue is under consideration by the Supreme Court, making it sub-judice and not suitable for an advance ruling at the current stage.