ITC on new Solar Panel purchased

[gvenugopal g]

Dear Experts,

Warm Greetings!

Entire spinning mills already given for rent containing Machines (spindles) and land & building and we raises GST Tax invoices every month for the 'rent for building (HSN # 997212)' and 'rent for Machines (HSN # 997314)'.

Solar Panel purchased and installed in October-2021 for generation of solar power used by the Tenant, we have increased the 'rent for machines' from the month of October-2021. And we have amended existing rental agreement effecting new machines (solar panel) and increase in rental value accordingly.

Can we take the ITC, which was paid on both purchase of Solar Panel Assembly and installation charges? Kindly suggest.

Thanks & Regards: G VENUGOPAL

AI Summary

Input Tax Credit Eligible for Solar Panels in Rented Spinning Mill under GST, Qualifies as Plant and Machinery A user inquired about the eligibility of Input Tax Credit (ITC) on the purchase and installation of solar panels used for generating power in a rented spinning mill. The forum discussed whether the solar panels, considered as plant and machinery, qualify for ITC under GST. Experts agreed that ITC is eligible since the panels are used for providing taxable services, despite being capitalized in the books. They referenced relevant Advance Rulings to support their views, affirming that solar panels are considered plant and machinery, thus allowing for ITC claims.