CREDIT OF SERVICE TAX PAID

[sanjay jain]

We are a manufacturing unit . we are registered with Excise and Service tax both. we are taking CENVAT credit of Excise duty on input received.

we are paying service tax in cash on freight of input  which we had paid after abatement of 75%.my queries are

1.can we debit (pay)service tax from Ex.duty CENVAT.

2.can we take credit of service tax paid by us on Telephone/Mobile Bill,on Bill of various Auditfees/cosultancy fees/professional fees etc.

[YAGAY andSUN]

Dear Sir,

Replies to your queries:

1. Yes, you can adjust the output service tax from the CENVAT credit availed on Inputs.
2. Yes, you can avail the CENVAT credit on Telephone, Mobile phones, Audit fess, consultancy services and professional fees etc as it is specifically mentioned in the definition of the Input services.

Best Regards,

Pradeep Khatri

YAGAY & SUN (Management and Indirect Tax Consultants), Mobile: 9818131923, e-mail: yagay@in.com; pradeepkhatri@mail.com

 

[R MUTHURAJ]

Dear Sir,

Reply given by Mr.Pradeep is correct except the point no.1 for the following reason:

In respect of service tax liability arises on Reverse charge basis, it has to be discharged ONLY by PLA/Cash as per the Explanation to the Rule 3(4) of  Cenvat Credit Rule, 2004

Regards,

R.Muthuraj

[sanjay jain]

Thanks Mr.R.Muthuraj.