We are manufacturer. Recently we have purchased new computers along with software licenses which are installed in factory wherein accounts, marketing, purchase etc. departments works. License are purchased for Microsoft office, and windows 8 and others software required for official use. Without these license we cannot operate computers. Since computers are installed in offices we have not avail CENVAT on any computers (as per capital goods definition). Without these licenses we cannot operate computers in Finance/marketing/purchase department.
My query is:
Can we treat this as a input service and avail the CENVAT credit on service tax charged on software licenses?.
Please share your views
Debate on CENVAT Credit Eligibility for Software Licenses: Essential for Office Use but Not Directly Linked to Manufacturing A manufacturer queried about whether software licenses for office use could be considered an input service eligible for CENVAT credit. They argued that licenses for essential software like Microsoft Office and Windows are crucial for business operations. A tax consultant responded that CENVAT credit might not be available unless the software is directly linked to the manufacturing process. Another contributor noted that since the software isn't directly related to manufacturing finished goods, credit cannot be claimed. The discussion highlighted the issue as debatable, with differing interpretations of input service definitions and their applicability to software licenses. (AI Summary)
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