Just a moment...

Report
FeedbackReport
Bars
×

By creating an account you can:

Logo TaxTMI
>
Feedback/Report an Error
Email :
Please provide your email address so we can follow up on your feedback.
Category :
Description :
Min 15 characters0/2000
Add to...
You have not created any category. Kindly create one to bookmark this item!
Create New Category
Hide
Title :
Description :
+ Post a Query
Post a New Query
Title :
0/200 char
Description :
Max 0 char
Category :
Delete Reply

Are you sure you want to delete your reply beginning with '' ?

Delete Issue

Are you sure you want to delete your Issue titled: '' ?

Discussion Forum

Back

All Issues

Advanced Search
Reset Filters
Search By:
Search by Text :
Press 'Enter' to add multiple search terms
Select Date:
FromTo
Category :
OR
Search by Issue ID:
NOTE: If you have inputs in both the fields, then results will be shown for issueId first.
Issue ID : 4437
- 0 -

New Input Service Distribution Mechanism

Date 27 Jul 2012
Replies4 Answers
Views 3211 Views
Asked By

We have one of our factory located in Jammu & Kashmir (Non Taxable Territory) operating under an excise notification No. 56/2002 with other factories located in Taxable Territory.

The finished goods manufactured at these factories are stock transferred to several depots spread across the country (Taxable territory) wherefrom these goods are sold. These Depots including Headoffice are registered under Service Tax as Input Service Distributor. There are certain common input services which are purchased by Depots / HO,  pertains to all the factories including Jammu Factory. Example of common services are Advertising of products which are manufactured by all the factories including Jammu factory.

My queries are as below:-

1. Whethe we are allowed to avail the cenvat credit of Input Services attributable to Jammu Factory (Non Taxable Territory)

2. If yes, whether the input servcies attributable to Jammu factory can be allocated to other factories located in taxable territory on prorata basis (Turnover Ratio).

4 answers
Sort by

Old Query - New Comments are closed.

Hide
- 0
Replied on Jul 27, 2012
1.

If there is duty payment under Not 56/02, Input services can be distributed. The turnover for distribution should be as per the turnover prescribed under Rule 5 of Cenvat Credit Rules

- 0
Replied on Jul 27, 2012
2.

Dear Sir,

The exemption Notification 56/2002 has been effected in such a manner that the factory in J&K that thefactory has to first pay excise duty through PLA after availment of available Cenvat balance at the end of  each month and then the duty paid through PLA is refunded by way of suo moto credit in account current.

In such case can we avail Cenvat credit of service tax attributable to Jammu factory for adjustment with Excise duty liability.

- 0
Replied on Jul 28, 2012
3.

As per the conditions of CCR, input service credit is available for the payment of duty on finished goods or for discharging Service Tax for the provision of service. As per Not 56/02, whatever duty paid through PLA is refunded and it provides utilisation by Cenvat also. Hence there appears to be no infirmity in availing Cenvat credit through ISD

- 0
Replied on Jul 31, 2012
4.

Yes, you can distribute the CENVAT credit to the Units established at J&K even under the Notification 56/2002- CE as amended by Notification No. 19/2008-C.E.

Further, you would have to comply with the conditions as mentioned in the Rule 7 and Rule 7A of the Cenvat Credit Rule, 2004, as amended time to time.

Old Query - New Comments are closed.

Hide
Recent Issues