Availment of cenvat credit of tax paid on warehousing charges to storage faciilty provided by Transport and logistic company.

[samiuddin ansari]

Hi...Good morning,

One unit namely, 'A ' has forwarded their finished goods to regular customer 'B' and they have agreement to deliver at manufacturing premises at another city. However, customer 'B' does not require material from supplier every time the same quantity. To save the time, the unit 'A' has availed and received the facility of storage of goods at Transporter and Logistics company say 'C' in the same city of buyer. In return, the 'C' company also issue taxable invoice for warehouse services to 'A', who in turn, avail the cenvat credit of taxes paid on such warehouse facility services. It is requested to through some light on eligibility of cenvat credit of such tax paid as input services to 'A' as the inclusive part of definition of input services prescribes 'storage up to the the place of removal'. In other words, whether cenvat credit of tax paid on warehouse facility provided by company 'C' at another city is entitled to supplier of the finished goods i.e company 'C'.

AI Summary

Company 'A' likely eligible for cenvat credit on warehousing services under 'storage up to the place of removal.' A company, 'A,' sends finished goods to customer 'B' but uses a logistics company, 'C,' for warehousing in the buyer's city due to variable demand. 'C' issues taxable invoices for these services, and 'A' claims cenvat credit for the taxes paid. The query concerns the eligibility of cenvat credit for such warehousing services under the definition of input services, which includes 'storage up to the place of removal.' Responses indicate that the credit is likely eligible as these services further business operations.