Cenvat Credit on Commission Service after changes of Cenvat Credit Rules

[Emco Ltd.]

Dear Sir,

With reference to changes in Union Budget 2014 under Notification No. 21/2014-NT Dated 11.07.2014, amended in Rule 4(A) , we should be availed Cenvat Credit Service Tax within a Six Month from date of issue of documents date. The effective date is 01.09.2014.

Our Query is that, while reconcile the GL, we found that One of the Invoice Dated 19.02.2014, we are not availing Cenvat Credit of Service Tax and it would be major amount of Service Tax. And Such Invoice is connected with Commission Service provided to us.

Can we avail Cenvat Credit of Service Tax in the current instant i.e. in the Month of Oct.2014 ? because the amended rules effected from 01.09.2014.

Whether it is right availment of Cenvat Credit or otherwise as per Cenvat Credit Rules ?

Kindly advice in the matter for which we will be act accordingly.

Regards

Amit Parmar

[SHIVKUMAR SHARMA]

DEAR MR AMIT

ANY CENVAT CREDIT OF DUTY, PAID ON INPUTS OR INPUT SERVICE IS PENDING FOR ITS POSTING IN THE STATUTORY CENVAT CREDIT RECORDS,FOR ANY REASON,TAKE IT IMMEDIATELY,OTHERWISE,SUCH CENVAT CREDIT, COVERED BY ALL DUTY PAYING DOCUMENTS,BECOME OLDER THAN SIX MONTHS ON 01/09/2014 IS NOT AVAILABLE.

SHIVKUMAR SHARMA

[Emco Ltd.]

Dear Sir,

Thanks for prompt reply of our query.

As far my knowledge is that there is not clarity in the amended rule 4 that we could not avail Cenvat Credit of Service Tax prior to Invoices of 01.09.2014. I think this rules applicable w.e.f. 01.09.2014.

Kindly advice per return whether any clarity of Rules or otherwise ?

Regards

Amit parmar

[YAGAY andSUN]

Dear Amit,

Please check Cadila Judgment as CENVAT credit is not allowed on Commission if such commission is related to sale of goods. Please check the facts and revert.

Regards,

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

AI Summary

Cenvat credit time limit: claims on older service invoices may be barred under the six month rule effective from the amendment. Amendment to Rule 4A imposes a six month time limit for availing Cenvat credit from the date of issue of duty paying documents, effective 01.09.2014; credits unposted and older than six months as of that date may be unavailable. Taxpayers should post pending credits promptly. Separately, Cenvat credit on commission services may be barred where the commission is connected to sale of goods, requiring factual verification against judicial precedent before claiming credit.