Cenvat credit of service tax paid on rent of premises

[krishna rao radha sri]

Whether servie tax paid on rent of premises can be claimed as input service credit under the CENVAT Rules by the provider of a taxable service

AI Summary

Service Tax on Rented Premises Claimable as Input Credit Under CENVAT Rules if Used for Taxable Services, Per Rule 6. A query was raised about whether service tax paid on rented premises can be claimed as input service credit under CENVAT Rules by a taxable service provider. The response clarified that rent can be claimed as input tax credit if the premises are used for providing taxable output services. According to Rule 6 of the CENVAT Credit Rules, a service provider can utilize either 100% credit or 20% of the output liability, contingent on maintaining separate records for the use of input services towards taxable or non-taxable output services.