service tax credit on new building

[Asked by Guest]

dear sir,

we are manufacturer of dutiable goods. we are having 2 units in existance and recently we have purchased other space are for producing the excisable goods in this regards we are constructing new building against we are receiving service tax input so question is that , can we take credit of the same? against my excisable goods (excise duty)

regards,

Manan Pandya

+919510018659

[YAGAY and SUN]

Dear Manan,

No you cannot avail the CENVAT credit on Building as the word "Setting Up" of Factory Premises has been removed from the definition of Input Services. Further, on civil structure no CENVAT is allowed.

Regards,

YAGAY and SUN

(Management and Indirect Tax Consultants)

[Rajagopalan Ranganathan]

Sir,

Service provided for construction of factory (which is called setting up of factory) was omitted from the definition of "input service" with effect from 01.04.2011 vide Notification No. 3/2011-CE (NT) dated 01.03.2011. Availment of service for setting up of factory was prior to 01.04.2011 then credit is available. Liability to pay service tax is related to the date of provision of service or date of invoice issued. If any one date falls on or after 01.04.2011 the you cannot avail the credit.

AI Summary

CENVAT credit on construction of factory premises denied when the service provision or invoice falls on or after regulatory exclusion.
Eligibility for CENVAT credit on construction of factory premises depends on the definition of input service and timing: construction services are excluded from input service under the regulatory change, so no credit is allowed where the service provision or invoice date falls on or after that exclusion; credit remains available only if the service was provided and credited prior to the exclusion.