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Service tax input

Sachin Rajput (account exe) (593 Points)

06 January 2012

Dear all,

I have a problem related to service tax input. i work in a event company .Recntly we have done a event project and total cost of dis project around 30 lacs.so we raised to separate invoice one without service tax and 1 with service tax-

1st invoice-30 Lac (without service tax)

2nd invoice -management fee on 30 Lac(10%)=300000+service tax(30900)= 330900/-

so now problem is that can we avial input from our supplier.

Thanks to all please help me

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5 Replies

CA Prabhat Gupta (Manager (Indirect Taxes)) (821 Points)
Replied 06 January 2012

Mr. Sachin,

Utilisation of Credit on inputs & input services used for providing output services is allowed. Where you are issuing a separate invoice for materials used in the event, that is as a reimbursement, it would mean that you acted as an agent for your client for precurement of such materials. The same would not be considered as inputs and hence no credit would be available on them.

But where the material gets consumed in the process of provisioning of service and the same is not charged separately from the client, it will come under the category of inputs and CENVAT Credit on the same would be available.