Hon’ble SC ruling allowing ITC on P&M needs a review?

With due respect to the Hon’ble Supreme Court ruling, my personal takeaway is that the ruling seems to have overlooked some crucial aspects (as apparent from para 32) and therefore, a review could be essential. Here are a few points:

1. Interpretation of “own account”;

– The ruling defines “own account” as situations where construction is made for personal use and not for service.
– It is intended for use by the person constructing as the setting for their business operations.

It’s important to note that any input tax credit for personal use is already restricted under Section 17(1) of the CGST Act. Hence, the same interpretation should not be applied under Section 17(5)(d) while using the term “own account”

2. Incomplete articulation of Section 17(5)(d);

– The ruling partially addresses Section 17(5)(d), with no discussion on the latter part that includes the phrase “including when such goods or services or both are used in the course or furtherance of business”
– A complete articulation might have led to a different outcome

3. Expressions ‘course’ and ‘furtherance’:

– The expressions “course” and “furtherance” are pivotal. While “course” may indicate the regular conduct of business, “furtherance” implies the advancement or promotion of business.
– These terms significantly impact the interpretation of “own account” and could have altered the ruling’s implications

Let’s see how this unfolds…