Cenvet Credit

[Asked by Guest]

Dear Experts Team,

1.Can company take Cenvet Credit adjustment at the time of payment of Service Tax if the company is deposit Service Tax on behalf of service provider

2. Can company take Cenvet Credit on Krishi Kalyan Cess.

[Ganeshan Kalyani]

1. Service tax liability of service provider is under his registration and liability of service receiver is under his registration. Both of their liabilities are different. You cannot adjust the service tax paid excess with his liability. Service Provider should pay his dues.

2. Kristi Kalyan Cess is cenvatable only to Service Provider only.

Thanks.

[KASTURI SETHI]

Sh.Umesh Kumar Ji,

I endorse the views of Sh.Ganeshan Kalyani, Sir. !00% correct.

But the company received service and applicable reverse charges. So how can we adjusted Krishi Kalyan Cess

Pls. suggest with example

[Ganeshan Kalyani]

Sir if company is a manufacturing unit then credit of Krishi Kalyan case is not allowed. If in addition to manufacturing activity it also provides any service then the input credit of KKC is available as credit to be set of against KKC payable. Thanks.

[KASTURI SETHI]

Sh.Umesh Kumar Ji,

Pl. wait for issuance of notification in this regard.

Thank You Very Much sir, for your valuable openion

AI Summary

Cenvat credit entitlement: service receiver cannot adjust provider's service tax liability; KKC credit limited to providers or service suppliers.
Service tax paid by a service provider belongs to the provider's registration and cannot be adjusted by the service recipient against the provider's liability. Cenvat credit of Krishi Kalyan Cess is generally available only to the person entitled to take cenvat credit; manufacturing units that only receive services cannot claim KKC credit, whereas entities also providing services may set KKC input credit against their KKC payable. Await formal notification for changes.