ITC ON CAPITAL GOODS FOR CONSTRUCTION OF BLDG

[NAMAN DOKANIA]

Can an assessee take ITC on Capital Goods used for constuction of building as well as interior furniture, if the property so construction is used for renting purposes.

1. CAse 1: Renting of Rooms like a Hotel

2. Case 2: Renting of Banquet Hall for marriage purposes.

Your opinion is highly recommended.

AI Summary

Input tax credit on capital goods: disallowed for building construction; movable furniture generally eligible for credit.
Credit is not available for capital goods capitalised to the building; immovable construction-related capitalisation does not attract ITC. By contrast, movable interior furniture and fixtures capitalised under furniture and fittings are generally regarded as eligible for Input Tax Credit because they are not subject to the capitalisation restriction, although an alternate position invoking section 17(5) and a pending contrary authority are noted.