BLOCKAGE OF ITC. DISTINCTION BETWEEN SECTION 17[5][c] & [d]

[Sadanand Bulbule]

Section 17 of the CGST Act provides for the blockage of ITC in respect of specified situations. Among them Section 17 [5] [c] & [d] relating to works contract are as under:

(c) works contract services when supplied for construction of an immovable property (other than plant and machinery) except where it is an input service for further supply of works contract service;

(d) 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 including when such goods or services or both are used in the course or furtherance of business.

However there is persistent ambiguity for some taxpayers engaged in the works contract business as to the application sub-section 5[c] which speaks about “supply”and 5[d] speaks of “receipt” and the precise circumstances thereof.

Experts are requested to clear the doubt with illustrations in the larger interest of all visitors.

AI Summary

Exploring GST Input Tax Credit Blockage: Clarity Sought on Section 17(5)(c) and (d) for Real Estate Sector. A discussion on the Goods and Services Tax (GST) focuses on the blockage of Input Tax Credit (ITC) under Section 17(5)(c) and (d) of the CGST Act, which pertains to works contract services for immovable property construction. The conversation highlights the ambiguity for taxpayers regarding the application of these subsections, with (c) addressing supply and (d) receipt of goods or services. Experts are requested to provide clarity with examples. The dialogue further delves into the legislative intent, interpretation, and implications of these provisions, particularly for the real estate sector, emphasizing the need for uniform interpretation and referencing relevant court judgments.