SR Constructions Vs Union of India (Tripura High Court)
In a recent ruling (W.P.(C) No. 399 of 2022 dated April 4, 2023), the Hon’ble Tripura High Court declared that the assessee has the right to claim Input Tax Credit (ITC) for taxable works contract services utilized in the construction of immovable property. Discover the significance of this ruling and its implications for taxpayers in availing ITC for construction-related services.
Facts:
M/s. SR Constructions (“the Petitioner”) is a construction company, entered into a contract with M/s Hotel Polo Pvt. Ltd. to construct a hotel. For providing output service of works contract services, the Petitioner received inward supply of various goods and services and paid GST on the same.
The Revenue Department issued a Show Cause Notice dated September 30, 2019 (“the SCN”) demanding ITC under Section 74(1) of the Central Goods and Service Tax Act, 2017 (“the CGST Act”) on the grounds that the Petitioner has availed ITC in violation of Section 17(5)(c) of the CGST Act.
The Petitioner filed reply to the SCN however, the adjudicating authority passed the order upholding the demand vide an Order dated October 13, 2020 (“the Order in Original”).
Aggrieved by the Order in Original passed by the adjudicating authority the Petitioner filed an appeal before the Appellate authority, whereby the Appellate authority vide Order in Appeal No.07/GHY (A)/Addl. Commr/CGST-AGT/2022 dated February 1, 2022 (“the Impugned Order”) confirmed the demand raised by the Adjudicating authority.
Aggrieved by the Impugned Order the Petitioner filed a writ before the Hon’ble Tripura High Court.
Issue:
Whether the Petitioner is entitled to avail ITC on the goods and services utilized for providing construction services to hotel building?
Held:
The Hon’ble Tripura High Court in WP (C) 399 OF 2022 held as under:
