Service Tax avail on manufacturer depot services

[Guest]

Dear Sir,

We have one manufacturing unit and due to shortage of space start a new manufacturer depot near by customer. our manufacturer depot register under central excise. We have transfer our FG after paying of duty under rule 7 from our factory to depot. In Manufacturer depot we have maintain RG23D register & duty pass on to customer on time of sale.

We have paid service tax on some services from our manufacturer depot like rent of depot, freight outward etc. Now my query is can we avail service tax in our manufacturing unit and adjusted with our duty? All invoices received on our manufacturing unit address.

[KASTURI SETHI]

There is nothing like manufacturer-depot, it is manufacturer, depot, dealer. Language improper.

[Suryanarayana Sathineni]

Dear Friend,

If that be the situation and you have not taken any centralized registration together with Input Service Distributor (ISD), then the credit of service Tax paid on such services used in the Depot, can be availed at your factory.

However, this is subject to the activity of Depot is not falls under "TRADING". If it is covers under Trading obviously you are not eligible for credit because Trading is an exempted service .

Best Regards

Suryanarayana

[KASTURI SETHI]

RG 23 D Register is to be maintained by dealer. Dealer deals in trading. Trading is exempted from Service Tax. Sh.Surya Narayana, Sir is right. In this case place of removal is factory gate as sale tax/VAT has been paid at the time of stock transfer from the factory ?

[Ganeshan Kalyani]

Sri Kasturi Sir, no sir VAT is not applicable on stock transfer as they are not sale. Thanks.

[Suryanarayana Sathineni]

Dear Ganesh Ji and Kasturi Sethi Ji,

Movement of goods from Factory to Depots treated as Stock Transfer under VAT and for this Form F is used.

Best Regards

Suryanarayana

[Ganeshan Kalyani]

Yes Sir Form F is required if the transfer is between two States and it is not required if transfer is within the States. Thanks.

AI Summary

Input service credit eligibility depends on centralized registration and whether depot activity constitutes trading, affecting availment. Credit for service tax paid at a depot can be availed at the manufacturing unit if there is no centralized registration with an Input Service Distributor and the depot's activity does not constitute trading; services attributable to trading are exempt and ineligible for credit, and maintenance of RG23D indicates dealer/trading activity while transfers to depots are treated as stock transfers under VAT with Form F for inter state transfers.