Cenvat Credit for the ST paid under RCM

[Mahendra L]

Dear Sir/Madam,

whether the Service Tax paid by the Service Receiver under RCM (Ex: GTA services Received by the Manufacture of Taxable goods by the Manufacturer under Central Excise act) can avail the Cenvat credit ? if Yes what is the provision and notification no as per the Cenvat Credit Rules ?

[CSSANJAY MALHOTRA]

Dear,

Please refer to Rule 4(7) of CENVAT Credit Rules 2004, which provides for admissibility of CENVAT Credit in case of RCM.

CENVAT Credit in case of Service Tax paid under RCM is available after the Service Tax payment has been made by the Service receiver. Refer to Rule 4(7) in recently amended Notification No. 21/2014-CE(N.T) dated 11.07.14 & Notification No. 06/2015-CE(N.T) dated 01.03.2015

 

[Mahir S]

Yes sir, input service credit for the payment made under reverse charge mechanism can be availed and then utilized, as explained above.

[Mahendra L]

Thank you sir

AI Summary

Cenvat credit for reverse charge services available to service recipients once the reverse-charge tax is paid. Service recipients may claim Cenvat credit for service tax paid under the reverse charge mechanism, but the entitlement arises only after the service tax has been paid by the service receiver, and availability is governed by the Cenvat Credit Rules and associated notifications.