Registration under service tax for claiming refund

[Guest]

Can a person, registered under Service Tax rules claim refund / adjust (due to excess input credit ) excess cenvet credit in next financial year

[Surender Gupta]

Unutilized balance of Cenvat Credit is allowed to be carried forward and can be utilized to pay service tax liability of next period. But it can not be claimed as refund execpt within the provision of Rule 5 i.e. in case of export.

[Guest]

As said by Surendra Sir the excess Input Credit can be adjusted in next financial year. With regards to this i had a small query for how much period is it possible to carry forward the excess input credit to be setoff against ouput service. In our case we have a input credit balance of 85000/- as on march 04 and for the current year also we have input credit of 150000/- however there was very less output service to adjust the same. Please guide whether can reverse excess input credit entry made in earlier year due to shortfall of output service tax.

[Surender Gupta]

In the new ST-3 form you will find that that for Cenvat Credit the particulars of opening balance, credit availed, credit utilized and Closing Blance. Therefore you have no restriction on carrying forward the closing balance in the next tax period.

AI Summary

Cenvat credit carry forward permitted; excess credit may be adjusted against future service tax liabilities, refund restricted. Unutilised Cenvat Credit may be carried forward and applied against future service tax liabilities; refund of excess credit is not generally available except for export-related provision. The ST-3 return records opening balance, credit availed, credit utilised and closing balance for Cenvat, and the closing balance may be carried forward to the next tax period for adjustment against output service tax.