CENVAT CREDIT

[S.C. WADHWA]

A company has a premises (showroom) on rent in which it sells excisable goods manufactured in another
premises(factory). The goods are cleared from the factory after payment of excise duty.
The company pays service tax on rent in repect of aforesaid showroom.
Now the question is whether such company can avail cenvat credit of such service tax paid
against excise duty payable on goods manufactured.

AI Summary

Debate on CENVAT Credit Eligibility for Showroom Rental Service Tax; Rule 6(3) Implications Discussed A company inquires about availing CENVAT credit on service tax paid for renting a showroom where it sells excisable goods manufactured elsewhere. One response suggests that if excise duty is paid on goods removed from the showroom, credit can be availed, as the renting service qualifies as input service up to the place of removal. Another view states that if the showroom is considered a trading venue, credit cannot be availed due to Rule 6(3). Further opinions clarify that renting a showroom is not an input service for manufacturing, and thus, credit is not eligible unless the showroom functions as a depot.