Dear Experts,
My queries relates to take credit of the service tax paid on out ward freight. below is brief of my sales patterns
1. We are a manufacturing unit,
2. We pay the freight on outward transportation ( dispatches made) and our delivery terms are door delivery therefore place of removal is customer gate.
3. We are showing Freight separately in invoices ...invoice pattern is as below.
Sale value for say 100 Rs.
inovices
Assessable value Rs. 98
Excise 12.5% : 12.25
Total : 110.25
Freight : 2
Cst : 2.5
Grand total _- : 114.5
We are paying service tax on ₹ 2 @14.5 % after availing of abetment of 70% in GTA.
Now my query is are we eligiable to take credit of service tax paid by company.
Regards
ram
Debate on Service Tax Credit Eligibility for Freight Charges Hinges on 'Place of Removal' Definition Under Excise Act. A manufacturing unit queries about eligibility to claim service tax credit on freight charges for outward transportation. The discussion involves multiple experts referencing circulars and case laws to determine the 'place of removal' under the Central Excise Act and Sale of Goods Act. Some experts argue that credit is permissible if the place of removal is the buyer's doorstep, provided ownership and risk remain with the seller during transit. Others cite recent Supreme Court judgments suggesting the factory gate as the place of removal, impacting credit eligibility. The debate also touches on revenue recognition principles under accounting standards. (AI Summary)
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