Utilisation of service tax for the payment of custom duty

[Guest]

A service provider imports a machinery for providing service taxable services and pays custom duty on its import. Whether credit for such custom duty paid is available against service tax due ?

[Surender Gupta]

Yes, on import of machinery, the CVD paid as Custom Duty shall be available for Cenvat Credit subject to other conditions of the CC Rules, 2004.

AI Summary

Cenvat credit: countervailing duty on imported machinery used for taxable services is eligible for credit subject to rules. Countervailing duty paid on imported machinery used by a service provider in rendering taxable services qualifies as Cenvat Credit, subject to compliance with conditions and procedures prescribed under the Cenvat Credit Rules and use of the machinery for taxable services.