Availment of input service Credit on Works Contract Service

[Sanjeev Chauhan]

Respected All,

Kindly guide,

A sugar manufacturing  unit, (Co-Op. P. Ltd.)  is availing credit on Erection, Commissioning & Installation services and on construction services used for construction of Godown and other civil structures for the   period 2011-12 & 2012-13.

W.e.f. 01.04.2011 input service credit on Works contract services is denied in Cenvat Credit Rules. 

Is the assessee  allowed to take credit on Erection, Commissioning & Installation services and on construction services used for construction of Godown?

Regards,

Sanjeev.

 

AI Summary

Input Service Credit on Construction Services Denied Post-2011 Cenvat Rules Change; Credit Claims Risky for Works Contracts A sugar manufacturing company queried about availing input service credit on erection, commissioning, installation, and construction services for building a godown, following changes in Cenvat Credit Rules effective from April 1, 2011. The response highlighted that credit on construction services is not permissible due to the removal of 'setting up' from the definition of input services. Although erection, commissioning, and installation services are not explicitly excluded, they might be considered part of works contract services, making credit claims risky. The inquirer acknowledged the advice, agreeing with the interpretation and expressing gratitude for the detailed explanation.