Case Details: Commissioner, CGST Appeal-1, Delhi Versus Bharti Airtel Ltd. (2025) 33 Centax 302 (S.C.)
Judiciary and Counsel Details
- Pankaj Mithal & Prasanna B. Varale, JJ.
- S/Shri N. Venkataraman, A.S.G., Rupesh Kumar, Sr Adv., Gurmeet Singh Makker, AOR, Padmesh Mishra, Navanjay Mahapatra & Pushpender Singh Nanda, Advs. for the Petitioner
Facts of the Case
The petitioner, a telecom operator, had availed input tax credit on telecommunication towers constructed on concrete bases. The jurisdictional officer under CGST disputed such availment on the ground that towers were immovable property, thereby attracting the restriction prescribed under section 17(5)(d) of the CGST Act. The petitioner contended that telecommunication towers do not satisfy the test of permanency, as they are not attached to earth in the manner of immovable property, can be dismantled and relocated, and are not erected with any intent of conferring permanency. It was further submitted that the placement of towers on concrete bases was solely to withstand environmental conditions and did not render them immovable. Reliance was placed upon the judgment of the Supreme Court in Bharti Airtel Ltd. v. Commissioner of Central Excise 2025 (391) E.L.T. 3 / (2024) 24 Centax 266 (S.C.), wherein it was conclusively held that telecommunication towers cannot be construed as immovable property. On this foundation, the petitioner argued that section 17(5)(d) was not applicable, and denial of input tax credit was unsustainable, and the matter was accordingly placed before the Supreme Court.
Supreme Court Held
The Supreme Court held that telecommunication towers cannot be regarded as immovable property as they neither meet the test of permanency nor can be said to be attached to earth in a manner contemplated under law. It observed that such towers are capable of being dismantled and moved, and their placement on concrete bases is only to counter natural forces, not to establish permanency. The Court further held that the mere exclusion of telecommunication towers from the phrase ‘plant and machinery’ under the statute cannot lead to the inference that the legislature considered them as immovable property. Applying the settled principles of construction, the Court affirmed that towers are movable property and would not fall within the ambit of section 17(5)(d). Consequently, input tax credit on telecommunication towers was held admissible, and denial thereof was unsustainable. The Court dismissed the special leave petitions under Article 136 of the Constitution, thereby upholding the legal position that towers are movable assets eligible for input tax credit, reinforcing clarity in the treatment of capital assets within the telecom sector.
List of Cases Reviewed
- Bharti Airtel Ltd. v. Commissioner — [2024] 169 taxmann.com 390 (Delhi) /[2025] 92 G.S.T.L. 467 (Delhi) /[2025] 29 Centax 3 (Delhi) — SLP Dismissed [Para 3]
