Cenvat Credit on rent a cab services

[RAJENDRA JOSHI]

Dear Sir,

My client is a Pvt Ltd company [ A Ltd ]. A Ltd obtains rent a cab services from proprietory firm. We pay service tax under revese charge machanism. My querry is, can we claim cenvat credit on tax paid on rent a cab service under reverse charge machanism ?

 

Thanks in advance,

CA Chetan Jadhav

      

 

[YAGAY and SUN]

CENVAT credit on Rent-a-Cab Services has been specifically denied in the CENVAT credit Rules, 2004.  You can- not avail the CENVAT credit on these services w.e.f. 01-04-2011.

[RAJENDRA JOSHI]

Thanks a lot sir for your promt reply.

[Jayaraman Mani]

dear sir

From 01.07.2011 reverse charges on rent a cab, we can claim cenvat credit by the service receiver

on payment of s tax.  Only servbice provider cab operatior cannot claim cenvat.

can u please check and inform them

AI Summary

Cenvat credit on rent-a-cab services: receiver may claim under reverse charge after paying service tax; provider cannot.
Cenvat credit for rent-a-cab services was specifically excluded by the CENVAT Credit Rules, 2004; however, under the reverse charge mechanism the service receiver may claim Cenvat credit on payment of service tax, while the cab service provider cannot claim such credit.