Input Tax Credit on Freight

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Our Company is Registered under Service Tax for Transport Services By Road, we are the Consignor/Consignee not the GTA, Can we Claim Input Credit on Services Received by us for paying service tax on freight. We are claiming Exemption under notification no.32/04 dated 12/03/04 i.e is 75% of the taxable amount.

AI Summary

Company Can Claim Input Tax Credit on Freight Services with Exemption, Subject to Restrictions on Inputs and Capital Goods A company registered under Service Tax for Transport Services by Road inquired about claiming Input Tax Credit on freight services received, while availing an exemption under notification no. 32/2004. Two responses were provided. The first confirmed that the company could claim input service credit while benefiting from the exemption, with restrictions on credit for input and capital goods. The second response highlighted a notification exempting service tax on transport vehicles supplied to a goods transport agency, noting that service tax is applicable only on 25% of the amount charged for GTA services. Cenvat Credit on inbound transportation is permissible, with specific guidance for outbound transportation.