Cenvat Credit of Input Service tax on Rent of office

[TEJASWINI BELOSE]

Can we avail and utilize Cenvat Credit of Service tax on rent of office in a manufacturing industry?? Whether Input Service tax paid for Office rent can be utilized for Payment of Output Service tax ??? Is it directly or indirectly related to manufacture of products in manufacturing Industry???

[Rajagopalan Ranganathan]

Gentlemen,

In my opinion service tax paid on Rent paid for office will not be allowed as credit since it do not have any nexus with manufacture of final products. However, service tax paid on rent paid to factory premises where the final products are manufactured will be eligible for credit.

[Mahir S]

Sir,

Office rent is not eligible for input credit . Also it has not been specifically discussed or allowed under the input service credit definition.

[YAGAY andSUN]

In our opinion, it will be available since, all tactical decisions, planning, Budgeting, etc pertaining to manufacturing are taken in the such offices, therefore have nexus with the finished goods.

[Ganeshan Kalyani]

Yes credit is eligible.

[A J DEORA & ASSOCIATES]

Input credit on Rent paid is allowed. Earlier, the Department is used to take a stand that credit cannot be allowed.

AI Summary

Debate on Cenvat Credit Eligibility for Service Tax on Office Rent in Manufacturing Sector: Diverging Views Emerge A query was raised regarding the eligibility of availing and utilizing Cenvat Credit on service tax paid for office rent in a manufacturing industry. The responses varied: one opinion stated that service tax on office rent is not eligible for credit as it lacks a direct nexus with manufacturing, while another view suggested that it should be eligible because strategic decisions related to manufacturing occur in offices. Some responses agreed that credit is eligible, noting past departmental resistance to allowing such credit.