Credit Received on Post manufacuring activity can i avail credit for central excise payment

[Ramesh M]

We are manufacturer of conveyors, we will manufacture goods in semi finished condition and clear under central excise duty payment to our customer place.  At our customer site we will erect / assemble the all parts and trail the equipments and we will commission the entire plant.  At our customer site all the activities done by our sub vendor, they will complete the work and submit the bill to us with Basic Value + Service Tax.  In this case our HO getting Input service credit on Vendor Bill.  Our HO also have ISD registriation and through ISD our HO transfered accumlated credit to our manufacturing unit.  Now department is objecting to transfer credit and availing credit at factory, because they said 'your HO is getting credit on erection, purely it is post manufacturing / post sale activity so credit is not allowed at manufacturing unit.

Kindly advice me, if any case laws to come out this issue.

 

AI Summary

Conveyor Manufacturer Faces CENVAT Credit Dispute Over Erection and Commissioning Services; Clarification Needed on Billing Practices A manufacturer of conveyors is facing an issue with availing CENVAT credit for services related to post-manufacturing activities, such as erection and commissioning at a customer's site. The head office, which has ISD registration, receives input service credit from sub-vendor bills and transfers it to the manufacturing unit. However, the tax department objects, stating that the credit is for post-manufacturing activities and should not be availed at the manufacturing unit. Responses suggest examining whether erection charges are separately billed and included in the assessable value, and clarify the scope of work in agreements to determine credit eligibility.