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Informist, Wednesday, Aug. 19, 2026

 

--SC rejects GST dept review plea in telecom tower tax case vs Bharti Airtel 

 

NEW DELHI – The Supreme Court Wednesday rejected the Central Goods and Services Tax Department's review plea against its 2025 verdict that telecom towers are moveable property and do not fall within the ambit of Section 17(5)(d) of the Central Goods and Services Tax Act, 2017, and so are eligible for input tax credit. The court further upheld the quashing of the tax department's demand order and show-cause notices against Bharti Airtel Ltd. and Indus Towers Ltd.

 

"We have carefully considered the review petitions as well as the grounds set out therein," a bench of Justice Vikram Nath and Justice Prasanna B. Varale said. "Having examined the impugned order in light of the grounds raised, we are of the considered opinion that there is no error apparent on the face of the record, in the order impugned, that would justify its reconsideration. Consequently, we find no merit in the review petitions. The review petitions shall stand dismissed accordingly."

 

Section 17(5)(d) states that if goods, services, or both are received by a person liable for tax for the construction of an immovable property other than plant or machinery on his own account, then the input taxes paid with respect to such goods, services, or both are not eligible for input credit.

 

Bharti Airtel and Indus Towers had argued that the tax department's notices and demand order sought to deny input tax credit on inputs and input services used for setting up passive infrastructure on the ground that the inputs and services were used in the construction of telecommunication towers and consequently fall within the ambit of clause (d) of Section 17(5) of the Central GST Act.

 

The telecom companies had said telecommunication towers are items of essential equipment used in telecommunications which can be dismantled at site and, thus, are capable of being moved. It is only the concrete structure on which those towers are placed that could be treated as an immovable element of the equipment.

The towers are set up on a concrete base to accord stability to them. That, in itself, does not detract from their basic characteristic of being items of equipment that are principally moveable, the companies said. Thus, the assumption that the installation of these towers results in the establishment of an immovable structure is misconceived, they argued.

 

The tax department had said the explanation at the end of Section 17(5) of the Act had excluded telecommunication towers specifically from plant and machinery. On this, the Delhi High Court had ruled that the specific exclusion of telecommunication towers from plant and machinery would not lead one to conclude that the statute contemplates them to be immovable property.

 

"Telecommunication towers would in any event have to qualify as immovable property as a pre-condition to fall within the ambit of clause (d) of Section 17(5). Their exclusion from the expression 'plant and machinery' would not result in it being concomitantly held that they constitute articles which are immoveable," the high court said. Challenging the high court's ruling, the tax department had moved the Supreme Court, which had also ruled in favour of the telecom companies in 2025.

  

Wednesday, shares of Bharti Airtel ended at INR 1,922.00 on the National Stock Exchange, down 0.6% from Tuesday. Shares of Indus Towers ended unchanged at INR 372.40.  End

 

Reported by Surya Tripathi

Edited by Rajeev Pai

 

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