whether cenvat credit can be utilised for the payment of service tax on work contract services of infrastructure companies which are directly attributable to the particular project ????
Senu Reddy (ca final) (291 Points)
27 December 2013whether cenvat credit can be utilised for the payment of service tax on work contract services of infrastructure companies which are directly attributable to the particular project ????
CA Amar kant kushwaha
(Consultant)
(73 Points)
Replied 28 December 2013
A service provider can utilise the Cenvat Credit of Duties/Taxes or Cess paid on Input Services and Capital goods for the payment of service tax on works contract services. however he can not utilise the Cenvat Credit of duties or cess paid on Inputs.
As per explaination 2 to rule 2A(ii), the provider of taxable services shall not take Cenvat Credit of duties or cess paid on any inputs, used in relation to works contract under the provision of Cenvat Credit Rules. This rule does not prohibit availment of credit on input used in works contract by the service reciever.
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