INPUT SERVICE DISTRIBUTION CREDIT OF PREVIOUS YEAR (2013-2014)

[Guest]

Can we distribute Service tax credit of F.Y. 2013-2014 of Renting of Immovable property to other units now i.e in June 2014, If yes then which F.year turnover is to be taken for pro rata calculation of credit. Please explain.

[YAGAY andSUN]

Dear Sandesh,

Please check meticulously Rule 7 of the CENVAT credit Rules, 2004 read with Explanation 1, 2 and 3 in this regard.  This Rule is self explanatory.

Regards

Team YAGAY & SUN

(Management & Indirect Tax Consultants)

[Ganeshan Kalyani]

In case of ISD if the service is availed for Ho, can that be distributed to units where it can be utilized against excise liability.

AI Summary

Clarification Sought on Service Tax Credit Distribution for FY 2013-14; Guidance Under Rule 7, CENVAT Credit Rules, 2004. A query was raised regarding the distribution of service tax credit for the financial year 2013-2014 related to renting of immovable property to other units in June 2014. The main concern was which financial year's turnover should be used for the pro rata calculation of the credit. One response advised reviewing Rule 7 of the CENVAT Credit Rules, 2004 for guidance. Another response discussed whether the Input Service Distributor (ISD) could distribute the credit to units where it could offset excise liability.