ITC Available On Capital Goods Used For Transmission Of Electricity From Power Station Of DISCOM To Factory Premises: Gujarat AAR
The Gujarat Authority of Advance Ruling (AAR) has ruled that the Input Tax Credit (ITC) available on capital goods used for transmission of electricity from power stations of Distribution Companies (DISCOM) to factory premises.
The bench of Amit Kumar Mishra and Milind Kavatkar has observed that there is no provision under the CGST Act, 2017 which bars availment of ITC by the applicant if subsequently the capitalised goods are handed over to Gujarat Energy 'Transmission Corporation Ltd. (GETCO)/others.
The applicant is an 100% EOU who has been granted letter of permission (LoP) by the Development Commissioner, Kandla SEZ, Gandhidham, for manufacture of hydro entangled (spun lace) non-woven products.
The applicant requires 1000 KVA power demand on 66 KV system voltage for its electricity/HT Power connection. The applicant need to install a 66 KV feeder bay at substation of GETCO under deposit scheme & also lay a 750 metres new 66 KV S/cable (3+1),630 mm square aluminium corrugated sheath U/G cable line from 66 KV Palej substation of GETCO to their switchyard at their Palej factory.
The applicant sought the advance ruling on the issue Whether a manufacturer is eligible to take ITC on the capital goods in the form of wires/cables electrical equipment etc used for transmission of electricity from power station of the DISCOM to the factory premises of the registered person which are installed outside factory premises as per rules and policy of GETCO, Government of Gujarat Electricity distribution company.
The applicant contended that it has satisfied all the four conditions in terms of section 16 of the CGST Act, 2017. Firstly the petitioner is in the possession of the tax invoice issued by the supplier. Secondly, they have received the goods and services. Thirdly, the tax charged has been paid to the Government and the return has been furnished under section 39. Lastly, the payment was made to the supplier within 180 days.
The AAR has ruled that the applicant is eligible to take ITC on the capital goods in the form of wires/cables electrical equipment etc (viz 750 metres new 66 KV S/Cable (3+1),630 mm square aluminium corrugated sheath/G cable line for installation of 66 KV feeder bay at substation of GETCO) used for transmission of electricity from power station of the DISCOM to the factory premises of the applicant.
Applicant's Name: M/s Elixrr Industries Pvt Ltd.