Dear Sir,
Our company is a C&F agent of a company and earning brokerage of 50 lacs and paying service tax. Our company also has Trading business with turnover of 400 crore and same have many agents for this sales. The agents are charging service tax on us. Now we want to adjust our output service tax with Input CENVAT. Whether it is allowable?
Company Seeks Guidance on Adjusting Service Tax with CENVAT Credit; Rule 6 Limits Credit for Trading Activities A company acting as a C&F agent and engaging in trading business seeks advice on adjusting output service tax with input CENVAT credit. The company earns a brokerage of 50 lakhs and pays service tax, while its trading business, with a turnover of 400 crores, involves agents charging service tax. One reply indicates that trading is exempt under Service Tax Laws, disallowing CENVAT credit. Another response clarifies that CENVAT credit is available for services used to earn brokerage but not for trading activities, with partial credit applicable for common services as per Rule 6 of the CENVAT credit rules. (AI Summary)
TaxTMI 
TaxTMI 
TaxTMI 
