Credit of Service Tax paid to Air travel Agent and Rent A Cab Scheme Operator

[Asked by Guest]

Can we Take Credit of Service Tax paid to Air travel Agent's Service and Rent A Cab Scheme Oprator's Service under Cenvet credit rule we are register under the head Input Service Distributor

[Surender Gupta]

A an input service distributor, you can take the credit of service tax paid to air travel agent's service tand rent-a-cab scheme operaoter's service and distribute to the another office. However, it should not be in relation to the office from where wholly exempted services are provided.

[Snehal Kulkarni]

As an ISD, you can avail the Cenvat Credit of Service Tax Paid on the ATA and Rent a Cab Service and pass to your manufacturing facility, only thing is that you have provide the nexus that these services are in relation with the Manufacturing of Final Product.

AI Summary

Cenvat credit: ISDs may distribute service tax credit on air travel and rent a cab, subject to nexus and exemption.
An ISD may take and distribute Cenvat credit of service tax paid on Air Travel Agent and Rent a Cab services to other units, provided those services are input services for the recipient units and not in relation to offices supplying wholly exempted services. The ISD must establish a nexus between those services and the recipient unit's taxable manufacturing or output activity before passing on the credit.