How to Claim GST Input Tax Credit on Repair of Factory Building

By | September 24, 2018
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(Last Updated On: September 24, 2018)

GST Input Tax Credit on Repair of Factory Building

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We have issued Work Order for Repairs to Factory Building. Can we take input credit for the GST? We will be booking this expense as Repairs in profit and loss Account and will not capitalise in Balance Sheet ?

My Comment : You can take Input Tax credit on repair of building since you are not capilaising Expenses under immovable property (Factory building ) in Balance Sheet.

Relevant Portion of Section 17(5) of CGST Act 2017 :-

(5) Notwithstanding anything contained in sub-section (1) of section 16 and sub- section (1) of section 18, input tax credit shall not be available in respect of the following, namely:—

……

(c)works contract services when supplied for construction of an immovable property (other than plant and machinery) except where it is an input service for further supply of works contract service;
(d)goods or services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business.
Explanation.—For the purposes of clauses (c)and (d), the expression “construction” includes re-construction, renovation, additions or alterations or repairs, to the extent of capitalisation, to the said immovable property;

Section 2(119) of CGST Act 2017 :– 

“works contract” means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract;

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