Utilize the ITC charged on purchases made in construction

[Jasbir Uppal]

My Dear experts. Need your help with the following query-

The assessee has construct immovable property and is not using for his own purpose but he is letting out the property for commercial use on which he is covered under the GST, can he entitled to utilize the ITC charged on purchases made in construction. In spite that Section 17(5)(d) of the Central Goods and Services Tax Act, 2017 treats input tax credit related to goods or services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account as a ‘blocked credit’. In other words, input credit for the same is not available.

AI Summary

GST ITC on Commercial Property Construction Blocked by Section 17(5)(d); Awaiting Supreme Court Decision for Clarity. An individual inquired about the eligibility to utilize Input Tax Credit (ITC) on purchases made for constructing an immovable property intended for commercial leasing under GST. Section 17(5)(d) of the Central Goods and Services Tax Act, 2017, classifies such ITC as 'blocked credit.' Responses highlighted a pending Orissa High Court decision that allows credit, though it awaits a Supreme Court ruling. Until the Supreme Court's decision, the existing law must be followed. The inquirer acknowledged the advice and expressed gratitude for the insights shared.