Input service tax credit limitation restricts use to a capped proportion of service tax payable on taxable output services. The Circular clarifies that if a service provider does not maintain separate accounts for input services used for taxable and exempt/non-taxable outputs, input service tax credit may be utilized only up to a capped proportion - 35% - of the total service tax payable on all taxable output services; field formations are to be informed and a trade notice issued.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Input service tax credit limitation restricts use to a capped proportion of service tax payable on taxable output services.
The Circular clarifies that if a service provider does not maintain separate accounts for input services used for taxable and exempt/non-taxable outputs, input service tax credit may be utilized only up to a capped proportion - 35% - of the total service tax payable on all taxable output services; field formations are to be informed and a trade notice issued.
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