GTA SERVICE TAX CREDIT ADMISSIBILITY ON OUTWARD FREIGHT

[SANDESH SHINDE]

Dear Sir,

Please explain regarding Service tax credit admissibility on outward freight under following circumstances 1) In the case of clearance of finished goods from the factory to the customers in such case whether we as a manufacturer has paid service tax under reverse charge can avail cenvat credit of such outward freight. 2) In the case of clearance of goods to depot which is not registered under excise whether we can avail such credit in such situation also, Please explain, Please give us any references regarding this.Thanks & regards.

AI Summary

Admissibility of Service Tax Credit on Outward Freight: Key Considerations for Manufacturers Under Recent Budget Changes A query was raised regarding the admissibility of service tax credit on outward freight for manufacturers. The discussion focused on two scenarios: clearance of finished goods to customers and to depots not registered under excise. Responses indicated that service tax credit on outward transportation is available if the sale occurs at the buyer's premises or if the depot is the place of removal. However, there are risks involved if revenue is recognized upon billing, and expert advice is recommended. The recent budget defines the point of clearance as the factory gate, affecting the admissibility of such credits.