SC dismisses govt's review petition in Safari Retreats case

THE Supreme Court on Wednesday dismissed the government's review petition in the Safari Retreats case, reigniting the debate over input tax credit (ITC) eligibility under GST for commercial real estate.

- DIPAK MONDAL @ New Delhi

In a landmark judgment, the Court upheld that ITC cannot be denied on construction costs if immovable property—like shopping malls—is used for taxable supplies such as leasing. The ruling introduced a functionality test, allowing credit where assets facilitate business operations.

According to tax experts, the Supreme Court's refusal to entertain the review brings much-needed clarity and relief to the industry, particularly sectors such as real estate, infrastructure, and leasing, where blocked credit provisions have had a far-reaching impact.