Service Tax credit on construction in factory premisis

[Asked by Guest]

Dear sir

we are manufacturer of plastic film and sales to domestic and export.

now my question is new machinery import by my company and also we installed this machinery in our new building constructed on previous month.

building contractor charged service tax on new building.

above service tax credit eligible or not ?

please guide me

thanking you

[PAWAN KUMAR]

Dear Sir,

Service tax cenvat credit related to civil construction is not eligible for availing cenvat credit as per rule 2(l)(ii)(A) of CENVAT Credit Rules, 2004.

[Mahir S]

Yes sir, input service credit not admissible on building/civil construction.

[YAGAY and SUN]

Dear Bharat,

Since the phrase setting up of factory has been removed and on civil construction CENVAT credit is specifically excluded therefore no service tax credit would be available on such services to you.

Regards,

Sameer Malhotra - Consultant

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

AI Summary

Cenvat credit on civil construction: not admissible for factory building under CENVAT Credit Rules exclusion.
Cenvat credit is not admissible for civil construction services charged by a building contractor on a new factory building; such input service credit is excluded under rule 2(l)(ii)(A) of the CENVAT Credit Rules, 2004, and the prior phrase permitting credit for "setting up of factory" has been removed.