cenvat credit of past liability

[Guest]

an assessee pays service tax liability after two years.Since now GAR7 is also an eligible document for taking credit, can the assessee take credit of the tax paid within 6 months of GAR7 date.

thanking you

[Ganeshan Kalyani]

In my view one to one correlation between liability and credit is not required. Therefore the credit can be taken except for interest which you are liable to pay.

[Mahir S]

Yes sir, if the service tax payment has nexus with the manufacturing activity, then you can take input service credit on such amount, except interest and penalty amount

[YAGAY andSUN]

If your service provider has not been issued SCN by the Service Tax Department, then, you can avail the CENVAT credit of input service having nexus either with finished goods or output services otherwise not. Please check with your service provider in this regard that whether any SCN had been issued on him or not?

[Guest]

YAGAY AND SUN

Dear Sir,

Please let me know what provision of cenvat credit rules prevent taking of cenvat credit of service tax paid on input servioce after issuance of SCN.

AI Summary

CENVAT credit can be claimed for past-paid service tax where nexus exists, excluding interest and where provider faces SCN. CENVAT credit can be claimed for service tax paid earlier where supported by an eligible document (such as GAR7) and the taxed services have a nexus with manufacturing or output services; temporal one-to-one correlation is not required. Interest and penalty amounts are excluded from credit. Availability of credit may be impacted if a show cause notice has been issued to the service provider, and claimants should verify the provider's SCN status before availing credit.