We are having excise registration for factory premises. We are leasing a portion of land to another party for 50 years for putting up utility (power transmission).. Ownership of land continue with us only.
The utility facilities are constructed by us under 'Build and Transfer' basis.
Pl clarify:-
whether cenvat credit on capital goods/inputs/input services for construction of facilities (bills are in our name) , can be availed.
Whether leasing of land out of registered premises, to be informed to Dept, whether said area to be deregistered.
Company Leasing Land for Power Transmission, Clarifies CENVAT Credit Limitations on Construction Inputs Under 'Build and Transfer' Arrangement A company with excise registration for its factory premises is leasing a portion of its land for 50 years to another party for power transmission purposes, while retaining ownership. They constructed utility facilities under a 'Build and Transfer' arrangement and inquired about availing CENVAT credit on capital goods, inputs, or input services related to construction. One response clarified that CENVAT credit is not available for civil construction unless it directly relates to the final product. It was advised to inform the Department and submit an application for changes in the layout plan. Another response emphasized that credit is only available if inputs are used for production. (AI Summary)
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