Eligible ? - CENVAT Credit on rent

[Sumeet Tholle]

Dear All,

My client is bank,  paying 1 lakh rent per month to landlord since April 2007.

Last month Landlord registered with Service Tax department  and raised invoice to bank and demanded Service Tax on rent at respective rates since October 2007 to till date as he is opting for VCES.

Can bank take Credit of Service Tax payable to landlord since Oct. 2007 till date ?

Pl. guide. Pl. send if any case law or circular/notification available.

Thanks.

Sumeet Tholle

CA, Aurangabad.

 

 

[YAGAY and SUN]

Yes, your client can avail the CENVAT credit on the supplimentory Invoice issued by the Service Provider.  This aspect of availment of CENVAT credit has also been incorporated in the VCES.

[Sumeet Tholle]

Thanks Sir.

It is at answer to question No. 22, VCES, FAQ issued by CBEC.

Thanks.

Sumeet Tholle

[MANDAVILLI RAMAKRISHNA]

you accept the request of the land lord.

obtain from him service tax invoice and challan for proof of payment with current year dates and take credit of that tax and avail the input in your returns. ask him to raise invoice with october month date so that you can claim input in your december quarter returns.

AI Summary

CENVAT credit on rent: eligible where supplier issues a supplementary invoice and tax is paid with documentary proof.
CENVAT credit on service tax charged on rent is claimable where the service provider issues a supplementary invoice and the tax is paid; this position is reflected in the VCES FAQ. The recipient must obtain the service tax invoice and challan as documentary proof and claim the input credit in the appropriate returns, timing the invoice date to permit claim within the relevant quarter.