Appellate authority rules land filling pit not plant/machinery, denying tax credit. Appellant's arguments rejected.

The appellate authority upheld the AAR's decision that the land filling pit is a civil structure and not plant and machinery, thus ineligible for input tax credit under Section 17(5)(d) of the CGST Act. The appellant's arguments and judicial precedents were considered but ultimately found unconvincing. The appeal was dismissed on all accounts.

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Issues Involved:
1. Whether the land filling pit is considered "Plant and Machinery" and thus eligible for input tax credit.
2. Whether the land filling pit is considered a "civil structure" and thus ineligible for input tax credit.
3. Whether the principles of natural justice were violated by the AAR by not considering the appellant's submissions and judicial precedents.

Detailed Analysis:

1. Classification of Land Filling Pit as "Plant and Machinery":
The appellant argued that the land filling pit should be classified as "plant and machinery" and thus be eligible for input tax credit under Section 17(5)(d) of the CGST Act. They cited various judicial precedents to support their claim that the term "plant" should be given a wide meaning, including the Supreme Court decision in *Scientific Engineering House (P) Ltd vs Commissioner of Income Tax, Andhra Pradesh*. The appellant emphasized that the land filling pit is an apparatus essential for their business of solid waste management and disposal, thus meeting the "functionality test."

2. Classification of Land Filling Pit as a "Civil Structure":
The AAR and the appellate authority concluded that the land filling pit is a "civil structure" and not "plant and machinery." They based their decision on the definition provided in the Second Explanation to Section 17(5) of the CGST Act, which excludes civil structures from the definition of plant and machinery. The authorities emphasized that the land filling pit is an engineered structure embedded in the earth, constructed using geo-synthetic materials, and thus falls within the ambit of a civil structure.

3. Violation of Principles of Natural Justice:
The appellant contended that the AAR violated the principles of natural justice by not considering their submissions and judicial precedents in the denovo proceedings. They argued that the AAR's order was a verbatim reproduction of its earlier order, which had been set aside by the Karnataka High Court for not sharing the jurisdictional officer's opinion with the appellant. The appellate authority acknowledged the appellant's grievance but upheld the AAR's decision, stating that the land filling pit is a civil structure and thus ineligible for input tax credit.

Conclusion:
The appellate authority upheld the AAR's decision that the land filling pit is a civil structure and not plant and machinery, thus ineligible for input tax credit under Section 17(5)(d) of the CGST Act. The appellant's arguments and judicial precedents were considered but ultimately found unconvincing. The appeal was dismissed on all accounts.

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