INPUT ON WORK CONTRACT SERVICE TO CLUB

[deepak gulati]

CAN A LEISURE/SOCIAL CLUB CHARGING SERVICE TAX ON MEMBERSHIP FEES /BUILDING FUND CAN CLAIM BENEFIT OF INPUT SERVICE TAX PAID ON WORK CONTRACT FOR CONSTRUCTION OF ITS BUILDING

[Mahir S]

Sir,

In your case, Input service credit is not admissible for construction or execution of works contract of a building or a civil structure or a part thereof.

[PAWAN KUMAR]

Dear Sir,

No, service tax paid on the service portion execution in a work contract is in exclusive part of the definition of input services under rule 2(l) of Cenvat Credit Rules, 2004 , Therefore Cenvat credit will not be admissible of such service tax paid.

[deepak gulati]

WE ARE RECEIVING BUILDING FUND FROM OUR MEMBER AND CHARGED SERVICE TAX ON THE SAME. CAN WE TAKE INPUT CREDIT OF WORK CONTRACT , AS WORK CONTRACT SERVICE ARE USED FOR PROVIDING CONTRACTION SERVICES TO OUR MEMBER.

[Mahir S]

Sir,

Cenvat credit on Work Contract Service is admissible only if output service is Work Contract Service or Construction Service.

Hence in your case, such credit is not admissible.

[DR.MARIAPPAN GOVINDARAJAN]

I agree with the views of experts.

AI Summary

Input service credit for work contract services is not available where output is membership or club services.
A club charging service tax on membership fees or building fund cannot claim input credit for service tax paid on work contract services for its building because the service portion of a work contract is excluded from the definition of input services under the Cenvat Credit Rules, 2004, and Cenvat credit on work contract services is allowable only when the output service is Work Contract Service or Construction Service.