service tax & Excise query

[VISHAL PURI]

We are a SSI manufacturer & Service Provider of Maintenance & Repair. we have a audit objection i.e we registered with Service Tax on 01-04-2014 after cross limit 10 lacs, then we take the service tax credit on rent of building & other business auxiliary service aprox 0.72 lacs, then we cross the ssi exemption limit and registered with central excise on 20-10-2014. we regular take the credit on excise & service tax. we pay the service tax on service providing by cash but not utilzed the service tax credit, year end we adjust the service tax credit on excise duty payment. audit team object that we can not take the credit & utilized on service tax credit before central excise registration i.e oct-2014. kindly advice audit team is right or worng.

vishal puri

AI Summary

Manufacturer Challenges Audit Objection on Service Tax Credit Utilization; Experts Cite Legal Precedents Supporting Early Credit Use A small-scale manufacturer and service provider of maintenance and repair services faced an audit objection regarding service tax credit utilization. They registered for service tax after exceeding the 10 lakh limit on April 1, 2014, and for central excise on October 20, 2014, after crossing the SSI exemption limit. The audit team objected to the credit utilization before excise registration. Experts in the forum clarified that credit utilization is permissible as per law, citing case laws supporting the credit claim even before registration. They advised contesting the audit objection, affirming the credit's eligibility and legal compliance.