CENVAT

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This query is : Resolved

Nitin Khandelia (Querist)

21 March 2009 Hello,
tell me criteria of service tax input availment. In other word so many times i face a problem on which service we avail CENVAT and on which not.
Also define whether availment of CENVAT credit criteria change in case of Service industry or the same procedure followed.

Dayal

Dayal (Expert)

21 March 2009 Do not take cenvat credit on all the services considering as “input services.

there is no negative list, however all expenses accounted for as business expenses, you can take the cenvat credit.

Cenvat credit to the extent of exempt services to be restricted. Therefore if common input service then only attributable cenvat credit for taxable services to be availed.

AVAILABILITY OF CENVAT CREDIT
A manufacturer or producer of Finished Product or
a provider of taxable service shall be allowed to
take credit called as Cenvat Credit of the following :
1. Cenvat
2. Special Excise Duty
3. Additional Excise Duty (Textiles & Textile
4. Additional Excise Duty (Goods of Special Importance
National Calamity Contingent Duty
6. Education Cess on above
7. Additional Custom Duty = Excise Duty
8. additional duty leviable under Section 3(5) of the Custom Tariff Act.
9. Service Tax
10. additional duty of excise leviable under section 157 of the Finance Act 2003
11. Education Cess on Service Tax
12. Additional duty of excise leviable on paan masala

UTILISATION OF CENVAT CREDIT
Cenvat credit may be utilised for the payment of the following :
1. Any duty of excise paid on any final product
2. Duty on input removed as such or after being partial processed.
3. Duty equal to cenvat credit when capital good is removed as such
4. Duty under central Excise Rule 16 (2) relating to final product received back, repaired and removed
5. Service tax on output services

This is absorbed from the act and interpreted in the spirit of the law for adherance.

You may kindly evaluate your position in light of the above

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