TaxTMI 
TaxTMI 
TaxTMI 
2020 (7) TMI 511
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....ct and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, the expression 'GST Act' would mean CGST Act and MGST Act. 2. FACTS AND CONTENTION - AS PER THE APPLICANT The submissions made by the applicant are as under:- 2.1 M/s Sundharams Private Limited, the Applicant, engaged in providing warehousing, storage and support services to the Original Equipment Manufacturers (OEMs) of automobile industry, transports cars/tractors using its fleet of car carrier vehicles. During the course of these services, the cars are stored in the applicant's stock yard prior to their transit to the respective car dealers. On storage rentals of these vehicles, the applicant Company has been collecting and paying applicable GST. 2.2 Applicant has purchased tax paid Paver Blocks which are laid in the parking area of the land without any attachment to the earth. The object of laying such blocks is to ensure efficient and safe parking of automobiles....
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....immoveable property. In the case of the applicant the expenditure on the paver block has not been booked as revenue expenditure in the books of account and therefore the same will not amount to construction of immovable property. Accordingly, the input tax credit claimed by the applicant cannot be hit by restriction placed u/s. 17(5)(c) of the CGST Act. 2.8 Applicant has discussed the definitions of 'Immovable property' "Movable Property" and the term 'Goods' and have submitted that the paver blocks have been laid on the entire yard Cars are parked on the paver block surface. In rainy season no mud is formed on the payer block surface and helps car to be removed from its slot easily; Bay marking can be done on the paver block which helps to identify the car easily and the paver block surface gives a strong grip for the movement of the cars. For placing the paver blocks, the base is prepared with stone and dust which are rolled very firmly. Then coarse aggregate is added on the surface and rolled. Grit powder of 30 mm is applied on the surface. After levelling the paver blocks are placed on the surface manually. The paver blocks are having interlocking and the gaps are filled with ....
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....ither cementing material or interlocking system, you cannot enjoy benefits of laying paver blocks. The flexibility to re-use does not mean that blocks will be removed and re-erected frequently. They are meant to be permanently fixed to earth however when the need arise, client may remove them and re-erect. So primarily nobody will lay paver blocks with intention to remove it. It appears that to give permanence, dealer has entered into contract with OEM and land owner also. 3.2 In the case of "Municipal Corporation of Greater Bombay and others Vs, Indian Oil Corporation Ltd., (1991 Supp (2) Supreme Court Cases 18" = 1990 (11) TMI 407 - SUPREME COURT, it was held that the petroleum storage tanks are structures or things attached to the land and were exigible to the property tax. In paragraph 32 it was observed as under: 32". The tanks, though, are resting on earth on their own weight without being fixed with nuts and bolts, they have permanently been erected without being shifted from place to place. Permanency is the test. The chattel whether is movable to another place of use in the same position or liable to be dismantled and re-erected at the later place? If the answer is yes ....
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....Immovable property u/s. 17 (5) (c) of the CGST Act, 2017 and are to be construed as moveable items. With respect to eligibility of ITC applicant has stated that, the prohibition to avail input tax credit is applicable only in respect of expenditure which is capitalized in the books of account and since, expenses on Paver Blocks are not capitalized as a part of immovable property (Land) in their books of accounts, ITC is allowable to them. Applicant has finally surmised that even if it is assumed that Paver Blocks as in the subject case, acquire the character of "Immovable Property", they should be allowed ITC as per the decision of Orissa High Court's decision in Safari Retreats Pvt Ltd. Vs. Chief Commr. of CGST reported in 105 Taxmann 324 = 2019 (5) TMI 1278 - ORISSA HIGH COURT. The Jurisdictional officer, citing the case law of "Municipal Corporation of Greater Bombay and others Vs, Indian Oil Corporation Ltd., (1991 Supp (2) Supreme Court Cases 18" = 1990 (11) TMI 407 - SUPREME COURT" has contended that laying of the paver blocks on land amounts to construction of immovable property u/s 17(5) and therefore, ITC is not allowable to the applicant. 4.5 The Paver Blocks broug....
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....Court, the laying of Paver Blocks to be used by the applicant for parking purposes results in immovable property'. It cannot be disputed that such Paver Blocks are not usually shifted from one place to another, nor is it practicable to shift them frequently. The Paver Blocks, once they arc erected and assembled, continue to operate from where they are positioned and actually become a part of the parking facility. Having regard to the manner in which these parking facilities are erected using Paver Blocks, they do not answer the description of "goods". 5.6 The Hon. Courts in our country have evolved the term 'immovable property' when faced with the question of what constitutes movable and immovable property. Though not issued under the GST Act, we may mention herein the decision/order passed by the Hon. Bombay High Court in M/s. Bharti Airtel Ltd. (earlier known as Bharti Tele-Ventures Ltd.) v. The Commissioner of Central Excise (2014 SCC OnLine Bom 907 : (2015) 77 VST 434) = 2014 (9) TMI 38 - BOMBAY HIGH COURT wherein the Hon'ble High Court had disallowed credit on telecom towers, holding them to be immoveable property. In the case of Tower Vision India Pvt Ltd v Commissioner of C....
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....cited i.e. "Municipal Corporation of Greater Bombay and others Vs, Indian Oil Corporation Ltd., (1991 Supp (2) Supreme Court Cases 18" = 1990 (11) TMI 407 - SUPREME COURT., can be made applicable in the present facts of the matter to rule that paver blocks are to be considered as immovable property in the subject case. In the said case the Hon'ble Supreme Court held that the petroleum storage tanks are structures or things attached to the land and were exigible to the property tax. The Hon'ble Court observed that, the tanks, though, are resting on earth on their own weight without being fixed with nuts and bolts, have permanently been erected without being shifted from place to place and this Permanency is the test. The fact that no nuts and bolts were used to imbed the tank to the earth by itself' is not conclusive. Though the witness stated that the tank is capable of being shifted, as a fact the tanks were never shifted from the places of erection. By scientific process. the tanks stand on their own weight on the earth at the place of erection as a permanent structure. 5.9.1 In the subject case, the Paver Blocks are also placed on their own weight on the earth at the place of e....
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....rty (as in the subject case), even when such goods or services or both are used in the course or furtherance of business. Further, it is also seen from the submissions that the immovable property in the subject case is neither plant nor machinery. Thus we find that, Section 17(5) (d) provides that no ITC is available in respect of any goods or Services received by a taxable person for construction of an immovable property on his own account even if such inputs and input services are used in the course and furtherance of business. In the instant case the applicant has himself built the immovable property (parking) for which he has received goods i.e. Paver Blocks. Therefore, as per Section 17(5)(d), no ITC is available on any goods or services received by him for such construction and the same cannot be claimed by him. Thus, the provisions of Section (17) (5)(d) squarely applies in the subject case and thus the applicant cannot avail input tax credit. 5.10.4 We find that, in the case of Sree Varalakshmi Mahaal LLP, the Advance Ruling Authority in Tamil Nadu = 2020 (1) TMI 31 - AUTHORITY FOR ADVANCE RULING, TAMILNADU, while deciding application uls 97(2)(d) raised on the question "W....