Appellate Authority for Advance Ruling — Input Tax Credit – The appellant department filed appeal against the AAR ruling. The applicant is a works contractor executing the works such as Reconstruction of the road work, awarded by the Government of Andhra Pradesh. The scope of the work is clearing and grubbing, stripping excess soil, earthwork. The applicant sought an advance ruling as to whether the applicant is eligible for ITC in respect of the GST paid on goods and services used as inputs in execution of ”Works Contracts” specifically in execution of Road work contracts to Government Engineering Departments; if not, on which type of goods/ services the ITC is not eligible. The AAR has ruled that the applicant is eligible for ITC in respect of the GST paid on inputs used in execution of “Works Contracts”. Restriction under Section 17(5) (c) and 17(5)(d) will not apply to the applicant. Aggrieved by the Ruling, the appellant department preferred the present Appeal. The authority observed that the embargo of Section 17(5)(d) of the Act, 2017 is when the construction activity is undertaken “on his own account”. As such, the restriction of the said Section 17(5)(d) is not applicable in the present case and it does not bar the applicant from availing ITC in providing Works contract service for road construction to the APPR Department.

Held that:- The Hon’ble Appellate Authority upheld the original order of the AAR.