GTA Service - 13/2011CE(NT)

[P Ovhal]

Dear Experts,

We are an Manufacturer-Exporter & pay ST by GAR-7/Challan on GTA (Inward-Outward) Services.

As per Notification 13/2011-CE(NT) if we cant pay to tranporter within 3 Months can we need to reverce CENVAT Credit? 

 

Regards

dear sir,

i am paying gta service outward freight charges not taken cenvat credit. if any possbile taken for cenvat credit.

 

regards,

 

K.A.Velayutham

 

[Mahir S]

The Notification 13/2011-CE(NT)   refers to payment of the value of input service and the service tax paid/payable thereon.

As transport of goods by road is also a taxable service, therefore any payment not made to the service tax provider within 3 months time period ( from the date of the invoice, bill or, as the case may be, challan);,the same is required to be reversed. However, the credit can be availed again after making such payments.. 

It is advisable to maintian a separate record for such reversal and recedit availed during the financial year, as the same may be verified by the Officers at the time of assessment of returns and also during Audit of the firm.

 

 

[Mahir S]

Mr. K.A.Velayutham, cenvat credit on the freight charges paid, can surely be availed.

Make a list of all such payments made in the current financial year and then avail credit thereon.

[NEERAJ KUMAR, RANCHI]

Dear Mr Ohval,

As far as I understand in case of transporter service tax is paid by the receipients of services and not by the transporter. If service tax is paid by you there is no point of not taking credit of that.

[P Ovhal]

Dear Mr. Naveed,

The volume of GTA services (Recd.) very huge, We received about 90-100 bills in the month and we paid ST against single GAR-7 Challan.

Then, we needs keep the track about the bills payment?

Please advice

[Mahir S]

Dear Mr. P Ovhal,

It is advisable to avail cenvat credit only after payment is made for the value of input service and the service tax payable thereon. In this way, there shall be no need for keeping track of so many Bills.

It is interesting to note that the said Notification does not speak about interest payment, in case credit is availed and reversed within three months time period, if payment for the same is not made. 

[tushar garg]

As per Notification 13/2011-CE(NT) if we cant pay to tranporter within 3 Months can we need to reverce CENVAT Credit? 

Yes as per second proviso to rule 4(7) of CCR, 2004, if the value of input service and the service tax paid thereon is not paid within 3 months of the date of invoice, then payment has to be made of an amount equal to Cenvat availed.

However after making the aforesaid payment, the service provider will become re-eligible to take cenvat credit paid by him earlier. 

[tushar garg]

As per Notification 13/2011-CE(NT) if we cant pay to tranporter within 3 Months can we need to reverce CENVAT Credit? 

Yes as per second proviso to rule 4(7) of  CCR, 2004, if the value of input service and the service tax paid thereon is not paid within 3 months of the date of invoice, then payment has to be made of an amount equal to Cenvat availed.

However after making the aforesaid payment, the service provider will become re-eligible to take cenvat credit paid by him earlier. 

AI Summary

Cenvat credit reversal required if payment to transporter is not made within three months; credit reclaimable after payment made.
Where the value of the input service and the service tax payable thereon are not paid to the service provider within three months of the invoice/bill/challan date, an amount equal to the cenvat credit availed on that input service must be reversed; the reversed credit may be reclaimed once the outstanding payment is actually made, restoring eligibility to take cenvat credit on that service.