TaxTMI 
TaxTMI 
2025 (4) TMI 229
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....on No. is 24AAA8372Q1Z2. 2. Briefly, the details as submitted by the applicant are as under: • that the applicant, is a public limited company as per the Companies Act, 2013 and its shares are listed on the stock exchange; • that they had initiated a share buyback programme^1 in December 2023; • that they are eligible for ITC on the expenditure incurred towards buyback of its shares; that the buyback of shares is an activity undertaken in the course or furtherance of business. 3. The applicant has further stated that buyback of shares improves company's financial standing, creates value for shareholders, contributes prestige & promotes the Company's image, reduces equity capital, leads to improve....
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....an advancement of business or promotion of business; that any activity carried on with a purpose to achieve business objectives, business principles, business continuity and stability would per se amount to an activity in course or furtherance of business; • that the buyback program constitutes a business activity undertaken to achieve its core objectives; that the definition of 'Business' u/s 2 (17) of the CGST Act, 2017, depicts that the definition is inclusive and encompassing various activities. • that clause (b) of the definition of 'business' encompasses activity like buyback of share or issue of shares' by a limited company as these activities are incidental or ancillary to the core business operation outlin....
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....ng, the applicant has sought a ruling on the below mentioned question viz: "whether the expenditure incurred by the applicant, a listed entity, for the buyback of its shares in the course of furtherance of business, is eligible for Input Tax Credit (ITC) under the GST regime? 7. Personal hearing was granted on 23.01.2025, wherein Shri Hardik Shah, Ms Heena Patel and Rakesh Kumar B Kayastha, on behalf of the applicant and reiterated the submission already made in the application. Discussion and findings 8. At the outset, we would like to state that the provisions of both the CGST Act and the GGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a....
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....de, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged; (101) "securities" shall have the same meaning as assigned to it in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956); Securities Contracts (Regulation) Act, 1956 (42 of 1956) • Section 2. Definitions .- (h):- "securities" include- (i) shares, scrips, stocks, bonds, debentures, debenture stock or other marketable securities of a like nature in or of any incorporated company or other body corporate; (ia) derivative; (ib) units or any other instrument issued by any collective investment scheme to the investors in ....
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....is Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies. (3) The value of exempt supply under sub-section (2) shall be such as may be prescribed, and shall include supplies on which the recipient is liable to pay tax on reverse charge basis, transactions in securities, sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building. [Explanation.- For the purposes of this sub-section, the expression "value of exempt supply" shall not include the value of activities or transactions specified i....
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....hall be entitled to take credit of ITC charged on any supply of goods or services or both used or intended to be used in the course or furtherance of business. Now a conjoint reading of the definitions as provided in section 2 (52), 2 (101) and (102), ibid, states that the activity undertaken, ie. buy back of shares by the applicant is neither a supply of goods nor supply of services. Therefore, in terms of section 16 (1), we find that the applicant is not eligible for availing ITC on the expenditure incurred for the buyback of its shares, it neither being goods nor services, a primary condition for availment of ITC. The applicant is therefore out of the ambit of section 16, ibid and is therefore not eligible to avail ITC on the expenditure....