Cenvat credit

This query is : Resolved

mahender (Querist)
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17 August 2013 1) as per the definition of 'Input Service' inword transportation & outward transportation upto place of removal eligible for Cenvat Credit.

2) Sr. No. 7 of Notification No. 26/2012-ST dated 20.06.2012 states 'No Cenvat Credit' available if Service Tax paid on 25% of amount charged. (Abatement Scheme) and it will be treated as 'Exempted Service' and will be taken for the calculation under Rule 6 of CCR.

3) Under 'Reverse Charge' If Consignor, Consignee who is liable to pay freight is a company, then it is liable to pay Service Tax on GTA Service on 25% value, if GTA not availing Cenvat Credit, subject to obtaining a Certificate from GTA, otherwise, liable to pay on 100% value

4) as per the definition of 'Output Service' Services on which whole Service Tax Payable under reverse Charge is not an 'Output Service'

my query is

1) If we paid Service Tax under 'Reverse Charge' on 25% of amount charged, can we take Cenvat Credit on 'Inward Transportation', if not

2) Can we pay Service Tax on 100% of amount charged and avail Cenvat Credit on 'Inward Transportation.

CA Kumar Mukesh

CA Kumar Mukesh (Expert)
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17 August 2013 In case of GTA is paid on Input Transportation then whole amount of GTA will eligible for Cenvat Credit.

However in case of GTA paid on outwards transportation other than depot transfer etc. then portion GTA paid on transpotation till the Gate of Factory/Plant will be eligible for Cenvat Credit

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