cenvat credit on fooding and hotel bill

[sarat sahoo]

Sir

Can cenvat credit be taken on hotel, food bill which was provided by the commercial educational institute to their teachers

[Ganeshan Kalyani]

Sir, in my view the Cenvat credit is not eligible as they are not in nexus with the output service provided. However, there are judgments wherein the assesse through advocate establishes the nexus of such welfare activity in manufacturing sector with the production activity. And the authority allows the credit. Anyhow I have not going any case law of this kind in service tax.Thanks.

[KASTURI SETHI]

Not admissible.

[KASTURI SETHI]

For more details go through Notification No.26/12-ST as amended (Serial No.4 along with conditions).

AI Summary

Cenvat credit on hospitality services requires nexus with output service; otherwise educational institute food and hotel bills ineligible. Cenvat credit on hotel and food bills provided to staff by a commercial educational institute is generally ineligible where there is no nexus between those hospitality expenses and the output service. Credit may be permitted only if the assesse can demonstrably establish a direct connection to the taxable output activity; limited manufacturing-sector precedents exist. No clear service-tax case law is cited, and Notification No.26/2012-ST (Serial No.4 and its conditions) is referenced as relevant to admissibility.