20% of input service tax

[Asked by Guest]

Dear Sir,

I wish to clear one of my doubt.ie In which stage we have to claim input serice tax @20%. and is 20%  is calculating based on Total oputput service tax or Total input servic Tax

[YAGAY and SUN]

I am afraid that you are reffering a very old provision of law pertaining to service tax.  Now, if you are manufacting or providing taxable or exempted service by using common input service then you would have to reverse the Equivalent CENVAT credit by giving the prior intimation to the concerned superintendent of Central Excise, Or as per formula mentioned in Rule 6 you would have to reverse CENVAT credit or pay an amount equivalent to 6% of the value of such services.

 

AI Summary

Cenvat credit reversal required when common input services are used, with prior intimation or payment under prescribed rule.
Where common input services are used in manufacture or in providing taxable or exempted services, the taxpayer must reverse CENVAT credit attributable to those services by giving prior intimation to the superintendent of Central Excise or by applying the prescribed formula to compute and pay an amount equivalent to the credit attributable to such services.