TaxTMI 
TaxTMI 
One assesse is claming bogus credit without paying any service tax , what are chances for asessment from Income tax or Service Tax dept
Assesee claiming bogus cenvat credit
24 May 2016 
4 Replies 
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Prosecution for fraudulent Cenvat credit may follow, with penalty, recovery and tax return scrutiny by revenue departments.
Bogus availing of Cenvat credit exposes an assessee to prosecution where fraud meets the statutory threshold, imposition of a penalty equal to the fraudulently availed amount under the Cenvat Credit Rules, and recovery of the credit with statutory interest under the Rules read with the Finance Act. Information exchange between revenue departments can prompt the income-tax authority to examine returns and disallow related amounts for income-tax purposes. (AI Summary)
Bogus availing of Cenvat credit exposes an assessee to prosecution where fraud meets the statutory threshold, imposition of a penalty equal to the fraudulently availed amount under the Cenvat Credit Rules, and recovery of the credit with statutory interest under the Rules read with the Finance Act. Information exchange between revenue departments can prompt the income-tax authority to examine returns and disallow related amounts for income-tax purposes. (AI Summary)