Purposive interpretation of residential house exemption: unregistered purchase agreement alone does not defeat relief, but investment must be verified...
The AAR ruled that Input Tax Credit (ITC) is not eligible for construction of immovable property under section 17(5)(c) and (d). The SC's interpretation in Safari Retreats P Ltd clarified that ITC is blocked for works contract services involving construction of immovable property, with limited exceptions for plant and machinery. In this case, the pre-engineered building, gantry beam, and associated structures are considered immovable property. Consequently, ITC is denied for steel, cement, consumables, installation services, and capital goods like rails and electrification used in constructing the integrated factory building and crane infrastructure, as these are embedded in civil structures and do not qualify for proportionate credit.
The AAR ruled that Input Tax Credit (ITC) is not eligible for construction of immovable property under section 17(5)(c) and (d). The SC's interpretation in Safari Retreats P Ltd clarified that ITC is blocked for works contract services involving construction of immovable property, with limited exceptions for plant and machinery. In this case, the pre-engineered building, gantry beam, and associated structures are considered immovable property. Consequently, ITC is denied for steel, cement, consumables, installation services, and capital goods like rails and electrification used in constructing the integrated factory building and crane infrastructure, as these are embedded in civil structures and do not qualify for proportionate credit.
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