Cenvat credit rules: allocation and utilization of input and input service credits adjusted, including reduced adjustment rate for exempt services.
Cenvat credit under the CENVAT Credit Rules, 2004 allows service providers to avail Service Tax paid on input services and duties on inputs and capital goods and to utilize that credit for Service Tax on output services or excise duty; supporting documents and payment timing rules apply, ISDs distribute attributable credit and must register and file returns, separate accounts or a statutory adjustment mechanism govern common use between taxable and exempt services, credit is not allowed on capital goods exclusively used for exempted services, and unutilized credit may be adjusted against exports or refunded subject to conditions. (AI Summary)