Dear All,
If service provider/ manufacture is liable to pay service tax under reverse charge mechanisum, then he should discharge his liability in cash ( without using CENVAT credit ).
My query is what provision/entry/notification specifies/ supports the above statement ????????
Thanks in advance
Service Tax Under Reverse Charge Must Be Paid in Cash, Not CENVAT Credit, Per Rule 3(4) Clarification A forum participant inquired about the payment of service tax under the reverse charge mechanism (RCM), specifically questioning if it must be paid in cash rather than using CENVAT credit. Several respondents confirmed that under Rule 3(4) of the CENVAT Credit Rules, 2004, service tax under RCM must indeed be paid in cash. They referenced the explanation introduced by Notification No. 28/2012-Central Excise (N.T), which explicitly states that CENVAT credit cannot be used for this purpose. The discussion clarified the rule and resolved the participant's query, aiding in the completion of their audit assignment. (AI Summary)
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