TaxTMI 
TaxTMI 
A company receive a credit note for law quality service and service tax is returned with credit note as per contract signed. Whether the service tax paid on credit note is eligible for cenvat credit
Declared service Section 66 E
17 May 2019 
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Cenvat credit eligibility affirmed where service tax on credit notes is linked to the original invoice and properly recorded.
A credit note reducing service consideration and recording returned service tax is eligible for Cenvat credit when it references the original invoice and complies with statutory requirements; Board circulars clarify availment on input services. Declared services remain services for credit purposes and do not prevent taking Cenvat credit. Normal collection obligations rest with the provider, while reverse charge arrangements require recipient payment; legal services fall under reverse charge notifications, necessitating proper documentation and adherence to RCM conditions to validate credit on credit notes. (AI Summary)
A credit note reducing service consideration and recording returned service tax is eligible for Cenvat credit when it references the original invoice and complies with statutory requirements; Board circulars clarify availment on input services. Declared services remain services for credit purposes and do not prevent taking Cenvat credit. Normal collection obligations rest with the provider, while reverse charge arrangements require recipient payment; legal services fall under reverse charge notifications, necessitating proper documentation and adherence to RCM conditions to validate credit on credit notes. (AI Summary)