Dear All,
We are the manufacturing unit but as per our Order terms we are supplying the Chemicals as well as we are providing the Technical & Testing service to our customer, for providing the mentioned service, we have deputed our employee on Site. we are paying his Hotel rent charges, Vehicle Hiring (For Employee Traveling purpose) Charges, Other Charges related to providing service. Please confirm me the can we eligible to availing input service tax credit on above mentioned services?
Manufacturing unit can claim input service tax credit on hotel rent but not on vehicle hire under CENVAT Credit Rules, 2004. A manufacturing unit inquires about the eligibility to claim input service tax credit for expenses incurred on hotel rent, vehicle hiring, and other charges related to providing technical and testing services. The response clarifies that if the gross amount charged includes these expenses and service tax is paid on this amount, credit can be availed for hotel rent and other related charges. However, vehicle hiring charges for employee travel are excluded from the definition of 'input service' under CENVAT Credit Rules, 2004, and thus, credit cannot be claimed for these charges. (AI Summary)
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