Service Tax return - Cenvat Credit Details

[Asked by Guest]

Hi Can anyone guide me w.r.to the following. Service Tax Half Yearly return form ST-3 Point No 5. The table contains following. 1. Opening Balance 2. Credit availed on inputs 3. Credit availed on capital goods 4. Credit received from Inputs service distri -butor Total Credit availed 5. Credit utilised towards payment of service tax Closing Balance. My query is, a) Is there any differential treatment for service tax on inputs and capital goods. Does the 50% rule as in Cenvat for Capital goods apply to ST also ? b) What is the diff between 'Credit availed on inputs services' and "Credit received from inputs service distributor". My other query is Point No 6. Credit details for input service distributor. Can any one clarify what does this mean. Is it details of tax credit and payments ? My last query is can any one tell me, as to where to mention the credit of service tax inputs transfered to Excise cenvat a/c to be mentioned ? Regards Vandana

[Surender Gupta]

Cenvat credit on capital goods is available equal to 50% in the first year and balance in the subsequent year. Concept of Input service distributor is applicable when service tax paid from one office but input services has ben received by anothe office of the same assessee. Input service distributor distributor destributes the input credit to the office from where the service tax is paid. Detail of such transfer is also to be given in ST-3. Cenvat Credit availed for Service Tax purpose can not be transferred for the payment of Excise duty.

[Vijay Chitte]

The credit in respect of the capital goods can be taken at any time during the financial year in which the goods are received in the premises. The credit of 50% can be taken in the said financial year. The remaining 50% can be taken in the subsequent financial year. In case the capital goods are to be removed on payment of the credit taken, the full credit is available in the same financial year. Difference between credit availed in input services and credit received from input service distributor : In respect of input services the credit can be availed on or after the date of payment of value of input service and the service tax paid or payable as reflected in the invoice. In respect of input service distributor: Explain by way of an illustration given below. i.e. One of your Regional head office at Mumbai and your Head office at Ahmedabad. The input service provider raise the taxable invoice of Rs.1102 (1000+102) at your HO Ahemedabad but the actual services provided at your RHO Mumbai premises, when the payment are made of this invoice from HO Ahemedabad, he will be require to distribute (The mechanism of distribute the credit given below para.) this input service tax credit of Rs.102 at your RHO Mumbai. It is a input credit received of Rs.102 for your HO Ahmedabad. Your query on point no. 6: The credit of Service tax received Rs.102 and the credit of service tax distributed is Rs.102 for your HO Ahmedabad purpose. Point no. 5 (A) in column of Credit received from input service distributor is Rs.102 for RHO Mumbai purpose. The mechanism of distribute credit (for your HO Ahmedabad), he will be obtain the registration of “Input Service Distributor” in form ST-1. (Notification 32/2005 ST, Special category of Person) There is no specific invoice to distribute the credit in Service Tax, but it must be fulfillment of all necessary requirements as per given below. The prescribed documents for availing credit of service tax and distribute thereon. 1. An invoice, bill for challan, issued by a provider of input service on or after 10.09.2004. 2. An invoice, bill or challan issued by an Input service distributor. An invoice, bill or challan issued by the provider of input service should contain the following details. i. The name, address and registration of the provider of the input service. ii. The name and address of the person receiving taxable service. iii. Description, classification and value of taxable service provided or to be provided. iv. The service tax payable thereon. An invoice, bill or challan, issued by the Input service distributor should contain the following details. i. The name, address and registration number of the person providing the input services including the serial number and date of the invoice or the bill of the input service provider on the basis of which the tax was paid by the input service provider. ii. The name, address and registration number of the input service distributor. iii. The name and address of the recipient of the credit distributor. iv. The amount of the credit distributor. And your last query of your answer is already given by Mr. Surender Gupta sir. Vijay Chitte Officer Taxation Claris Lifesciences Ltd. Ahmedabad.

AI Summary

Cenvat credit on capital goods requires staged availment; Input Service Distributor rules allocate input service credit across units.
Form ST-3 requires reporting of opening balance, credits availed on inputs and capital goods, credit received from an Input Service Distributor, total credit availed, credit utilised for service tax and closing balance. Capital goods credit is taken in staged instalments with full credit treatment when removed on payment. An Input Service Distributor registers in form ST-1, distributes credit from the paying unit to recipient units, and distributions must be supported by specified provider invoices and ISD distribution documents. Service tax Cenvat credit cannot be transferred for excise Cenvat payment.