Cenvat credit of the amount paid to caterer

[Rajeev Kalra]

my company has engaged a caterer for serving meal/snacks to our employee from 01.04.05 till date .till 31.03.2007 caterer did not take service tax registration no. and did not pay service tax to department on sum received from our company. from 01.04.2008 caterer discharged his liability of service tax after getting service tax registration no. now caterer has received a demand of Rs. 7 lacs and caterer has written a letter to our company for reimbersment of the same as he had not claimed service tax earlier in his bill. now i want to know 1)can we take cenvat credit of the amount if we paid to caterer even if he was not registered with service tax department during provision of service to our company and not eligible for claiming service tax from our company

AI Summary

Caterer Seeks Reimbursement for Unpaid Service Tax; CENVAT Credit Allowed Pre-Registration, Excludes Interest and Penalties. A company engaged a caterer to provide meals to employees from 2005, but the caterer only registered for service tax in 2008 and now faces a tax demand. The caterer seeks reimbursement from the company for the unpaid service tax prior to registration. The responses suggest that while the issue is controversial, CENVAT credit can be claimed based on the service provider's bill, even for periods before registration, as there is no explicit restriction in the CENVAT Credit Rules, 2004. However, credit cannot be claimed for interest or penalties on late payments.