TaxTMI 
TaxTMI 
TaxTMI 
2026 (4) TMI 280
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.... to three suppliers namely Uma Infra Project Co., Parth Construction and Kirti Infrastructure Ltd. 3. The SRP typically utilizes distillation, adsorption or 2.5 membrane separation processes to reclaim solvents from waste streams, enabling reuse and reducing environmental impact. The detailed process is as under:- • During production: The Applicant uses multiple solvents and upon completion of these processes, a resultant Spent Solution is generated which comprises of residual solvent mixed with other chemical substances. • Spent Solution: The spent solution can neither be reused directly due to the presence of impurities that may compromise product quality, nor can it be disposed of directly as it contains valuable recoverable material and may pose environmental and regulatory concerns. • Recovery of usable solvent: The spent solution is subjected to a controlled distillation process within the SRP. The solution is heated to temperatures close to the solvent's boiling point, causing the solvent to vaporize. The vaporized solvent is passed through a condenser where it is cooled and converted back into liquid form. • Outcome: Th....
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.... coolant to achieve temperatures lower than water-based chilling systems. • Water Chiller: It cools down process solvents or effluent before phase separation or storage and is generally used for standard chilling requirements in the SRP system. • Cooling Towers: These cooling towers act as a support system for distillation and heat exchange operations as it provides general purpose cooling for utilities in the SRP system by circulating cooling water used in heat exchangers and condensers. 5. These equipments cannot be placed directly on the land or its surface without adequate structures to support them. Due to the operational load, torque, and vibrations generated during use, a specifically engineered foundation is essential prior to the installation of such equipments. The foundation serves critical purposes, including providing structural stability, preventing overturning, absorbing vibrations, and ensuring proper alignment and positioning of the equipment. In the absence of such a foundation, the machinery is susceptible to operational damage, misalignment, and potential hazards due to instability. Therefore, aforementioned equipment is installed an....
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.... which are specifically designed to support the load of all installed equipment and ultimately transfer these loads to the ground. 4. Civil work for MPP-5 Unit-1 The MPP-5 is a building which houses a number of process and utility equipments. In order to install such equipments, the Applicant is required to construct RCC structures which include key load-bearing elements such as slabs, pedestals, columns, beams, etc. which are designed to support the load of all installed equipment and ultimately transfer these loads to the ground. 5. Civil work for METP work Unit-2 In order to install the machinery and equipment for the METP, the Applicant is required to construct RCC structures including key loadbearing components such as beams, slabs. pedestals, etc. which are specifically designed to support the load of all installed equipment and ultimately transfer these loads to the ground. 6. Civil work at Unit-2-RO MEE area In order to install the machinery and equipment for the METP, the Applicant is required to construct RCC structures including key loadbearing components such as beams, slabs, pedestals, ete. which are specifically designed to support the load ....
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....nfra Project Co., Kirti Infrastructure Ltd. and Parth Construction had raised tax invoices for total consideration of Rs. 1.36,98,569.95/-. Rs. 4.57,08,715/- and Rs. 23,74,287/- respectively on which GST amounting to Rs. 94,24,307/- has been discharged. The Applicant has availed the proportionate ITC amounting to Rs. 94,24,307/- on these input services received from Uma Infra Project Co., Kirti Infrastructure Ltd. and Parth Construction in relation to foundation and structural support for the various equipment installed in the SRP and METP within the factory premises of the Applicant. 9. The Applicant has sought a ruling on the following issue: Whether the Applicant is eligible to avail ITC on input services used for construction of foundation and structural support for plant and machinery installed within the factory of the Applicant, for recovery of solvents and treatment of wastewater used in the manufacturing of Active Pharmaceutical Ingredients, in terms of Section 17(5)(c) of the CGST Act, 2017? 10. The applicant has submitted their interpretation of law as under:- (a) The inputs and input services procured by the Applicant are in the course or further....
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....ession "plant and machinery" under the Explanation to Section 17 of the CGST Act includes the foundation or structural support for such plant and machinery. 'Foundation and structural support' has not been defined in the CGST Act. Further, there exists no exclusion from the scope of 'foundation and structural support' when such work is undertaken for the installation and erection of the plant and machinery. Therefore, all such foundational works undertaken for the installation of plant and machinery shall be deemed to be part of plant and machinery in accordance with the Explanation under Section 17 of the CGST Act. (g) The various equipments used for recovery of solvent and treatment of wastewater during the production of APIs are installed either on Reinforced Cement Concrete ("RCC") structures or on structural steel framework. The RCC structure provides a strong and stable foundation to support equipments, ensure proper alignment and are specifically designed to distribute load of heavy equipments. It includes key load-bearing elements such as columns, beams, slabs, pedestals, etc. In the present case, tank farms were installed on RCC circular platforms and machinery ar....
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.... the manufacturing plant and emergency systems. Improper or absent structural support can lead to equipment failure, safety hazards, and regulatory noncompliance. Thus, structural support was critically important for these equipments. Foundational RCC and Structural steel support to equipments in METP: METP uses similar equipments as used in SRP plant and thus needs similar structural and foundational support. Without proper structural support, they may collapse, misalign or rupture. Thus, RCC and structural support are essential for equipments in METP. Structural support by piling and shuttering: Herein, piling is a critical structural activity undertaken to transfer the load of plant and machinery to deeper strata. ensuring long-term stability and operational integrity. Shuttering, on the other hand, is a necessary formwork used during the RCC casting process to shape and support the structural base during curing. (j) It is submitted that ITC has been availed solely in relation to the foundational and structural support provided to plant and machinery as iterated above through RCC and structural steel components. It is further submitte....
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....t 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 reference to the CGST Act would also mean a reference to the same provisions under the GGST Act. 13. We have considered the submissions made by the applicant in their application for advance ruling as well as the submissions made both oral and written during the course of personal hearing. We have also considered the issue involved, the relevant facts & the applicant's submission/interpretation of law in respect of question on which the advance ruling is sought. 14. The short issue to be decided is whether the applicant can avail ITC on the input services used for the construction of foundation and structural support for the equipments installed inside the SRP and METP plant. The equipments which are installed in these plants are Reactors, Kettles/Reboiler/Distillation columns, Phase separators, Heat Exchangers, Storage Tanks/ Intermediate Receivers, Centrifugal Pumps, Brine Chiller, Water Chiller and Cooling Towers, whose functions has already been mentioned....
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..... These services are provided by M/s Uma Infra Project Co., M/s Parth Construction and M/s Kirti Infrastructure Ltd.. The details of work undertaken for the foundation and steel structures by the service providers, on which the various machinery and equipment are to be installed in the SRP and METP, have been mentioned in Para 6 supra. The foundations are mostly MS Steel Structures and RCC, which comes under the ambit of works contract service. Section 17(5)(c) of the Act, ibid restricts the ITC of works contract services when supplied for construction of an immovable property. However, if the said works contract services are used in the construction of plant and machinery, then the ITC of the same can be availed by the service recipient. 17. Thus, the issue for determination is whether the foundation and structural support fall under the definition of 'plant and machinery' as mentioned in Section 17 of the Act. Explanation to Section 17, defines what comes under the ambit of 'plant and machinery', which we reproduce below:- Explanation:- For the purposes of this Chapter and Chapter VI. the expression "plant and machinery" means apparatus, equipment, and machinery fixed....
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.... has also been provided. He has also emphasized that many machineries cannot be installed directly on open ground; rather, specialized civil structures are essential to manage dead loads, torque, vibrations, Dynamic load etc. Adherence to the relevant IS Codes is mandatory to ensure operational stability, prevent overturning, and reduce vibrations. In conclusion, he has submitted that the machineries were supported on RCC and Steel structures and these structures were made only to support the machines. 20. We find that CBIC in Circular No. 219/13/2024-GST dated. 26.06.2024 has clarified that ITC on ducts and manholes used in network of Optical Fiber Cables (OFC) are eligible, as they are the basic components for the OFC network used in providing telecommunication services. These ducts are necessary for not only laying of OFC but also their upkeep and maintenance. It was further observed in the Circular that ducts and manholes are covered under the definition of "plant and machinery" as they are used as part of the OFC network for making outward supply of transmission of telecommunication signals from one point to another. Moreover, ducts and manholes used in network of optical f....
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.... reproduced below:- "16. On going through the layout of the VCV line which is reproduced in the impugned ruling, the process inside VCV tower undertaken at each floor and the weight of the significantly heavy components to be placed on each floor [reproduced supra], we are in agreement with the appellant's averment that the concrete structure is essential to support and erect the VCV lines. It is more so since the appellant has stated that the concrete structure in the form of VCV tower serves as a critical foundation and support system for the manufacturing process; that it provides stable base for tower components; that it absorbs vibrations & ensures accurate positioning of extruder, cross head and other elements. Given these facts, we find that plant and machinery in terms of the second explanation, placed beneath section 17, ibid, specifically includes foundation and structural support. The exclusions from plant and machinery are also listed viz. (i) land, building or any other civil structures; (ii) telecommunication towers; and (iii) pipelines laid outside the factory premises. Further, 'other civil structures' means civil structu....