Service tax credit on making the new partition and cabins in existing factory

[Asked by Guest]

Dear Sir,

We have registered with excise and service tax as manufacturer. In our factory we made some modification in plant layout so we making some additional partition and cabina for staff members and installation the machine as per new plan. For this purpose we gove contract for this work and he give invoice with service tax as a work contract service.

My question is can we take the credit of this service tax ?

Regards

Swapneswar

AI Summary

Service tax credit eligibility depends on classification as modernization/renovation rather than set-up; accounting treatment is decisive.
Admissibility of service tax credit depends on whether contractor services for partitions, cabins and plant reconfiguration qualify as input service for modernisation/renovation of factory premises. Demonstrable evidence-accounting treatment, contract clauses and invoice description-must show the works are renovation/modernisation rather than a set up or unrelated modification, since capitalisation or documentation suggesting set up may negate the credit.