TaxTMI 
TaxTMI 
2025 (10) TMI 240
X X X X Extracts X X X X
X X X X Extracts X X X X
.... filed under Section 100 of the CGST Act, 2017 and the GGST Act, 2017 by Assistant Commissioner, CGST and Central Excise, Division VII, Bharuch, Vadodara-II Commissionerate, (for short - 'appellant') against the Advance Ruling No. GUJ/GAAR/R/2024/18 dated 2.7.2024. 3. M/s Elixir Industries Private Limited, Plot No. 101, GIDC Palej Industrial Estate, Palej, Bharuch, Gujarat-392220 [for short - 'respondent'] is a 100% EOU, engaged in the manufacture of hydro entangled (spun lace) non-woven products. For its electricity/HT power connection, they require a 1000 KVA power demand on 66 KV system voltage for which they need to install a 66 KV feeder bay at substation of GETCO [Gujarat Energy Transmission Corporation Ltd] under deposit scheme & also lay a 750 meters new 66 KV S/cable (3+1), 630 mm square aluminum corrugated sheath U/G cable line from 66 KV Palej substation of GETCO to their switchyard at their Palej factory. 4. For the aforementioned requirement of laying a 66 KV line, GETCO offered the respondent two options viz a) either carry out the above work through GETCO itself; or b) to do the above work on their own [as per option 3 of GETCO estimate for 10....
X X X X Extracts X X X X
X X X X Extracts X X X X
....M to the factory premises of the applicant. 8. The below mentioned findings, led the GAAR to arrive at the aforementioned ruling that :- a) they are not hit by 17(5)(c) of the CGST Act, 2017; b) they have capitalized the basic value as capital goods and the tax portion is being availed as ITC; that they are not hit even by the explanation; c) as far as 17(5)(d) is concerned, the respondent states that they are covered by the explanation which defines plant and machinery and that they are also not hit by the three exclusions listed in the explanation; d) though these are underground cables, they are not fixed to earth; e) they are kept in a duct and can be removed/opened as and when any maintenance is required to be done on these goods; f) even on this count, the ITC sought by the respondent is not blocked by sub-sections 17(5)(c) & (d), ibid; g) there is no provision under the CGST Act, 2017 which bars availment of ITC by the applicant, if subsequently the capitalized goods are handed over to GETCO/others; h) post availment of ITC, if subsequently, the capitalized goods are handed over to GETCO/others, the l....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rred in allowing the ITC on the capital goods, in the form of wires/cables electrical equipment etc. [viz 750 meters new 66 KV S/Cable (3+1), 630 mm square aluminium corrugated sheath/G cable line for installation of 66 KV feeder bay at sub-station of GETCO] used for transmission of electricity from power station of the DISCOM [Distribution Company] to the factory premises of the respondent. 14. The primary ground raised by Revenue is that the installation of 66KV feeder bay is outside the factory & the ownership lies with GETCO. Therefore, it cannot be categorized as plant and machinery and is, therefore, blocked under section 17(5) of the CGST Act, 2017. Further, since the goods will be transferred to GETCO, ITC is liable to be reversed or paid back in terms of section 18(6). 15. Facts that are not disputed even by the Revenue is that the conditions for availing ITC, as far as section 16 of the CGST Act, 2017, is concerned, stand fulfilled. As far as the ITC being hit by section 17(5)(c) and (d) is concerned, we find that the GAAR has discussed the same in paragraphs 19 and 20 of their impugned ruling, wherein it was held as under: "19. Likewise, section 17 of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ct and can be removed/opened as and when any maintenance is required to be done on these goods. Even on this count, the ITC sought by the applicant is not blocked by sub-sections 17(5)(c) & (d), ibid." As far as applicability of section 18(6) of the CGST Act, 2017, is concerned, the GAAR has given its finding in paragraph 22 of the ruling, wherein it was held as follows: "22. We find that there is no provision under the CGST' Act, 2017 which bars availment of ITC by the applicant if subsequently the capitalized goods are handed over to GETCO/others. However, we would like to point out to the applicant of the liability cast on him, in such situations in terms of section 18(6) of the CGST Act, 2017. We do not wish to further delve into the same, since the issue is not before us. We restrict ourselves to the question raised before us" 16. We find that the departmental appeal does not put forth any grounds as to why the aforementioned findings are not legally tenable except for a bald averment that the same cannot be categorized as 'plant and machinery' & hence blocked by section 17(5) and that the aspect of section 18(6) was not followed. The findings in paragraph 19 an....