We build factory shed. then we give that on rent. Can i claim itc agianst rent income payble gst??

Reply—Under section 17(5)(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 are not eligible for input tax credit.

Further under section 17(5)(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 are also not eligible for input tax credit.

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.

However decision held by ORISSA HIGH COURT in case of Safari Retreats Private Limited dated 17.04.2019, ITC will be allowed in respect of goods or services used for construction of immovable property for letting out.

This issue is pending before Supreme court, therefore taxpayer cannot avail ITC in respect of goods or services used for construction of immovable property for letting out.