Service Tax CENVAT on Software Purchase for R&D Purpose

[Asked by Guest]

Dear Sir,

we have purchased a Software for R&D Purpose software company has charged professional service charges & charged Service tax on his invoice. my query is :

Can we entitable to avail CENVAT Credit of the same or Not.

Please give your legal opinion and reference of rule.

Regards,

Rahul Patel

AI Summary

CENVAT credit on R&D software: entitlement depends on whether the software charge qualifies as an input service.
Entitlement to CENVAT credit for software service charges depends on whether the software fee qualifies as an input service. One view permits credit when the software is used in relation to manufacture, provision of taxable goods/services, or ancillary business functions. An alternative view denies credit for software used in internal R&D unless R&D is the purchaser's taxable business and its outputs are supplied for consideration liable to service tax.