AAAR Upheld AAR Ruling Which Denied ITC on Air Conditioning, Cooling, and Ventilation Systems

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  • Last Updated on 17 June, 2024

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AAAR confirms AAR's decision

Case Details: Appellate Authority for Advance Ruling, Ahmedabad Wago (P.) Ltd., In re - [2024] 163 taxmann.com 395 (AAAR-GUJARAT)

Judiciary and Counsel Details

  • Samir Vakil & B.V. Siva Naga Kumari, Member
  • Chitresh Gupta & R. Sharma for the Petitioner.

Facts of the Case

The appellant was establishing a new factory and it had filed an application for advance ruling before the Authority for Advance Ruling (AAR) on the eligibility of ITC on procurement of air conditioning and cooling system and ventilation system including the services of installation and commissioning the same.

The AAR held that the appellant would not be eligible for ITC on air conditioning and cooling system and ventilation system since they are blocked credit falling under Section 17(5) of the CGST Act, 2017.It filed appeal against the order.

AAAR Held

The Appellate Authority for Advance Ruling noted that the installation of the air conditioning and cooling system and ventilation system via a works contract service would make it an immovable property. Therefore, it would cease to be a plant and machinery and ITC would be blocked under Section 17(5)(c) of CGST Act, 2017. Thus, it was held that the appellant would not be eligible to avail ITC on supply of air conditioning and cooling system and ventilation system.

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Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied