We have taken Input service credit on service catagory namely on Cleaning Service & Pest control service by our Mumbai office during the period 2009 to 2011. Our Mumbai office has taken Service Tax Registration under Input Service Distributor (ISD) and transferred the credit to our factory by issuing ISD Invoice. Kindly let us know whether the credit taken on cleaning & Pest control services is eligible for credit ? We have been asked to reverse the credit by the Excise Auditors. Kindly gives your valuable views.
Regards,
VINAY
Service Tax Credit for Pest Control Services Denied; Rule 7 of Cenvat Credit Rules Cited A company inquired about the eligibility of input service credit for cleaning and pest control services taken by their Mumbai office from 2009 to 2011. The Mumbai office, registered as an Input Service Distributor (ISD), transferred the credit to their factory. However, excise auditors requested a reversal of this credit. A respondent clarified that the service tax credit is not legally eligible because the pest control services provided at the office do not relate to the manufacturing activities at the factory due to their remote location. Reference was made to Rule 7 of the Cenvat Credit Rules, 2004. (AI Summary)
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