Input Service credit - Insurance policy for the Barges & Tugs -Reg

[vinay wakde]

Our company owned Barges & Tugs which are used for bringing the indegenious raw materials from various ports & also used for the transporation of finished goods from jetty to high seas in case of Export. The company has taken Insurance policy such as Hull & Machinery Policy, War Risk policy etc. for their  Barges & tugs & also Third party Liability policy to cover the risk of damage the jetty by third party Barges which are arriving from other ports.  We are registered under service catagory 'Supply of Tangible Goods ' under Service Tax. We are service receiver as well as service provider under the said catagory.

Kindly clarify whether the CENVAT credit to the extent of Service Tax paid on referred Insurance policy is eligible or not ?

Regards,

VINAY

AI Summary

Company Can Claim CENVAT Credit on Insurance Services if They Enhance Output Service Quality or Relate to Business A company using barges and tugs for transporting raw materials and finished goods inquired about the eligibility of claiming CENVAT credit on service tax paid for insurance policies, including Hull & Machinery, War Risk, and Third Party Liability. The company is registered under 'Supply of Tangible Goods' for service tax purposes and acts as both service provider and receiver. Respondents advised that if the insurance services enhance output service quality or relate to the business, the company can claim CENVAT credit. They suggested that existing favorable judgments support this position.