ITC on Lease Hold Land Payment

By | September 8, 2018
(Last Updated On: September 8, 2018)

ITC on Lease Hold Land Payment

Q: Can we avail ITC on lease hold land payment made upront for 20 years, and to be capitalized in books.

Author Opinion : Yes you can avail ITC on Lease Hold Land Payment  if it is in relation to business , even if it is capitalised .

‘The restriction of  in respect of capitalisation applies to construction services only .

Refer 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;

Refer GST Input Tax Credit : Free Study Material


Category: GST

About CA Satbir Singh

Chartered Accountant having 12+ years of Experience in Taxation , Finance and GST related matters and can be reached at Email :

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