Constitutional challenge to GST input tax credit restrictions fails as Supreme Court upholds Section 17(5)(c) and (d).

The constitutional challenge to clauses (c) and (d) of Section 17(5) of the CGST Act was rejected because the provisions had already been upheld by the Supreme Court. The governing interpretation distinguishes "plant or machinery" from "plant and machinery" in clause (d), and recognises that whether an immovable property can qualify as a plant depends on the functionality test applied to the facts of each case. The result is that the impugned input tax credit restrictions under Section 17(5)(c) and (d) remain valid.

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Issues: Whether the constitutional challenge to clauses (c) and (d) of Section 17(5) of the Central Goods and Services Tax Act, 2017 was established.

Analysis: The challenge to the validity of clauses (c) and (d) of Section 17(5) stood covered by the Supreme Court's decision, which upheld the vires of the impugned provisions. The governing approach also recognises that the expression "plant or machinery" in clause (d) cannot be equated with "plant and machinery", and that the question whether an immovable property can qualify as a plant depends on the functionality test applied to the facts of each case.

Conclusion: The constitutional challenge to Section 17(5)(c) and (d) failed, and the provisions were upheld.

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