Availment of cenvat credit on advance payment of input service

[vishal bhattad]

whether the assessee can avail cenvat credit on advance payment of input service without receving the input service ?

[Surender Gupta]

Yes, there is no restriction in the Cenvat Credit rules for avaiing cenvat credit on advance payment.

[Guest]

Practically Service Provider is supposed to issue a Invoice for the service rendered on the strength of which cenvat credit is taken. Unless service is delivered , service provider cannot issue such Invoice, as such , Cenvat Credit cannot be taken unless service is received.

[sudhir V S]

yes credit is possible. As per rule 4A of Service Tax Rules, the invoice has to be issue within 14days for provision of service or receipt of money which ever is earlier. hence based on such invoice credit can be availd.

AI Summary

Cenvat credit on advance payment: permissible if invoice is issued within the prescribed time and receipt conditions are met. Whether cenvat credit may be availed on advance payment for an input service depends on invoice issuance and receipt conditions: one view notes no express restriction on crediting advances under the Cenvat Credit framework; another insists credit follows receipt of service and issuance of invoice; a practical stance permits credit where an invoice is issued within the prescribed timeframe for provision of service or receipt of payment.