Can Service tax Cenvat Credit taken and Utilization without Service tax registration ??

[SNEHAL SHAH]

Dear sir,

We are the Manufacturing of the Chemical products as a finished goods and sale in domestic and international markets .

We are the registered with ISD registration at Head office address ( New delhi ) and distributed the cenvat credit at plant located in Gujarat .

Can Gujarat plant take cenvat credit of service tax and utilize the duty amount for dispatch the material in domestic markets ??

Please guide in this matter .

Thanks and Regards,

SNE

[Rajagopalan Ranganathan]

As per Explanation 1 of rule 7 of CENVAT Credit Rules, 2004 “unit” includes the premises of a provider of output service and the premises of a manufacturer including the factory, whether registered or otherwise.

Therefore your Gujarat plant can take cenvat credit of service tax and utilize the duty amount for dispatch the material in domestic markets.

[Ganeshan Kalyani]

I agree with Rajagopalan sir. Also take care of ISD process before distribution of cenvat credit.

[SNEHAL SHAH]

Thanks to both for valuable reply .

Regards,

SNEHAL SHAH

AI Summary

Cenvat credit entitlement: plant premises may claim and utilise service tax credit where ISD distributes input service credit. Under the rule explanation, a 'unit' includes the premises of a manufacturer whether registered or not, so a plant can take Cenvat credit of service tax and utilise that credit against duty on domestic dispatches; the Input Service Distributor process at the head office must be followed before distribution and proper records maintained.