TaxTMI 
TaxTMI 
Service tax reversal
10 Jun 2014 
1 Reply 
1575 Views Asked by
CENVAT credit reversal advisable for CHA inward transportation charges when inputs are returned or later sold.
Advisory response: Reversal of CENVAT credit on input services such as Customs House Agent inward transportation charges is not expressly specified in the CENVAT Credit Rules, 2004 for machinery returned to supplier or for capitalized machinery subsequently sold, but reversal is advisable due to administrative and litigation risk where the input service does not support taxable activity. (AI Summary)
Advisory response: Reversal of CENVAT credit on input services such as Customs House Agent inward transportation charges is not expressly specified in the CENVAT Credit Rules, 2004 for machinery returned to supplier or for capitalized machinery subsequently sold, but reversal is advisable due to administrative and litigation risk where the input service does not support taxable activity. (AI Summary)
Sir, we have purchased two machinery from japan and pay cha charges (inward transportation charges)1. one machine return to japan, whether we have to reversed service tax on cha charges or not.2. another machine was capitalized and after that sold it, whether we have to reversed service tax on cha charges or not.Regards, K.Gopal