Tamil Nadu GST Advance Ruling TN/111/AAR/2023: No Guidance Provided
The Authority for Advance Ruling closed this case without a decision because the company withdrew its request.
- Ruling
- Advance Ruling No.111/AAR/2023 dated 10.11.2023
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
The short version
- Subam Papers asked if they could claim input tax credit for machinery foundations.
- The company later asked to withdraw their application.
- The Authority closed the case without deciding on the tax credit eligibility.
- This order provides no legal guidance on input tax credit for civil structures.
In short
The company asked the Authority for Advance Ruling (AAR) if they could claim Goods and Services Tax (GST) input tax credit on materials used to build foundations for their factory machines. Before the authority could decide, the company withdrew its request after their auditor advised them to reverse the credit they had already claimed.
What has changed
How it worked before
Businesses often face uncertainty regarding whether civil structures like beams and columns that support machinery qualify for input tax credit.
What has changed
Nothing changed because the authority did not issue a decision on the merits of the case. The ruling is merely a record that the application was withdrawn, meaning the tax question remains unresolved by this specific order.
Who this affects
Manufacturing businesses that are building or expanding factory structures and want to know if they can claim input tax credit on construction materials.
An example
Imagine a textile mill builds a concrete platform to hold a heavy loom. They might wonder if they can claim GST input tax credit on the cement and steel used. This ruling does not help them, as it provides no answer on whether such a claim is allowed.
What you should do
Do not rely on this ruling to support your own tax claims, as it contains no legal conclusion. An advance ruling only binds the specific business that asked the question and their local tax office; it is not a general law for other companies.
If you do nothing
If you assume this ruling supports your tax position, you risk a tax audit and potential penalties. A tax officer is not required to follow a withdrawn case, and you may be forced to pay back claimed credits with interest if your interpretation is found to be incorrect.
The terms explained
- Input tax credit
- The tax a business pays on its purchases that it can use to reduce the tax it owes on its own sales.
- Advance ruling
- A written decision from tax authorities on how tax laws apply to a specific business situation.
- Civil structures
- Permanent building components like walls, beams, and foundations that support machinery or factory operations.
The ruling in detail
Authority for Advance Ruling
M/s SUBAM PAPERS PRIVATE LIMITED
Advance Ruling No.111/AAR/2023 dated 10.11.2023 · Tamil Nadu
Questions before the authority
- Whether input credit on materials used for such civil structures meant for machineries can be availed?
- If so, what is the procedure under which ITC can be claimed?
Facts
The applicant is a manufacturing company producing packaging paper. During expansion and modernization, they constructed civil structures such as columns, beams, and walls to support machinery. They sought an advance ruling on the admissibility of input tax credit for materials used in these civil structures.
Ruling
The Authority for Advance Ruling did not decide the merits of the case. The application was disposed of as withdrawn at the request of the applicant. The applicant had communicated their decision to withdraw the application after being advised by their auditor to reverse the input tax credit.
Reasoning
The applicant requested to withdraw their application via a letter dated 09.11.2023. They stated that the issue of eligibility of input tax credit had been resolved by reversing the credit as advised by their auditor. Consequently, the Authority allowed the application to be treated as withdrawn without going into the merits of the case.
Provisions relied on
- Section 98(4) of the CGST Act, 2017
- Section 98(4) of the TNGST Act, 2017
- Section 103(1) of the Act
- Section 103(2) of the Act
- Section 104 of the Act
- Rule 104 of CGST Rules 2017
- Rule 104 of SGST Rules 2017
For the practitioner
This ruling provides **no guidance** on the substantive issue of input tax credit eligibility for civil structures used for machinery. It serves only as a procedural record of the applicant's withdrawal of their request. Practitioners should note that this order has **no precedential value** regarding the merits of the underlying tax question.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/111_subham_papers.pdf
Legibility of the scan, as read: high.
Prepared 13-10-2026.
About Patron Accounting LLP
Patron Accounting LLP is a CA and CS-led accounting and compliance firm that has been working with businesses across India since 2019. We handle the work that keeps a company correct with every department it answers to: day-to-day bookkeeping and accounting, GST registration and returns, income tax filing and assessments, TDS, payroll and PF/ESI, company and LLP incorporation, ROC and MCA compliance, statutory and internal audit, physical stock and inventory audits, trademark and other registrations, and the certificates and reports that banks, buyers and regulators ask for.
Our clients range from a first proprietorship registering for GST to established companies running operations across several states. Much of our work is exactly this: reading what a department has published and telling a business, in plain terms, whether it changes anything for them.
We operate from five offices and serve clients across the rest of India remotely:
- Pune (HQ): RTC Silver, B4-708, Sai Satyam Park, Wagholi, Pune, Maharashtra 412207
- Mumbai: 104, Rajshila Building, 597 J.S.S. Road, Marine Lines, Mumbai 400002
- Delhi: 3rd Floor, B-6/154-155, Sector 5, Rohini, Delhi 110085
- Gurugram: Pioneer Urban Square, B109, Golf Course Ext Road, Sector 62, Gurugram 122098
- Ahmedabad: Phoenix Tower, 1107, near Commerce Six Road, Drive In Road, Navrangpura, Ahmedabad, Gujarat 380009
If anything on this page affects you and you would like somebody to look at your own position, we are glad to help. Call +91 94594 56700, write to sales@patronaccounting.com, or visit patronaccounting.com. The first conversation costs nothing.