Cenvat credit of service tax on job work

[sanjay aggarwal]

An asseessee is having its factory located in excise free zone He has to bear the freight paid on raw materials & freight paid on finished goods. 1 At the time of inward freight, he pays service tax. Now at the time of payment of service tax on the outward freight, he wants to take credit of service tax paid on inward freight? 2.He also pays job work charges for getting his own material processed from some other factory. The job work bill include ser tax also. Whether he can take cenvat credit of ser tax on job work for payment of ser tax on outward freight ?

[Surender Gupta]

Absolutely no. There is no provision for availing cenvat credit for making payment of service tax on outward transportation by the recipient of services.

AI Summary

Cenvat credit denial: recipient cannot use inward freight or job work service tax credit to pay outward transportation service tax. There is no entitlement to use credits of service tax paid on inward freight or on job work services to meet the service tax payable on outward transportation by the recipient; no provision permits availing cenvat credit for payment of service tax on outward transportation by the recipient of services.