Cenvat Credit of Branch in the case of Centralised Reg.

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This query is : Resolved

krunal Thakkar (Querist)

24 December 2010 Dear All,

One of my client is providing Services under banking & financial Services having more than 12 branches all over the india.It has a centralised Registration at H.O. for all the branches and paid Service tax of all the branches from H.O..There is also real time software for accounting of all the unit so accounting transactions done at any branch unit is displayed at H.O. and H.O. can genrated consolidated or individual branch Trading, P & L, B/S at any time, any level.
I want to know, whether H.O. can take Input Credit of Expenses incured at Branch against consolidated Payment of Service Tax at H.O. Level. Is there any specific procedure to be followed for this purpose? Whether Branch is required to take Ser.No. As Input Service distributor for transferring credit ot H.O. in the case of this centralised registration? or it credit can be taken straight away as per the consolidated input credit account?
Plz its Urgent.

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)

24 December 2010 Yes HO can take input credit on service tax paid by the branches. Branches has to be registered as input service distributor, and they can transfer the credit to HO.

krunal Thakkar

krunal Thakkar (Querist)

24 December 2010 Dear Professiona Colleage, Thanks for your reply...but still i have one confusion that as the there is Centralised Registration, Do all branches are required to take No as Input Service Distributor? Can't H.O. take Input Credit of branches straight away from the consolidated input credit account?

Madhukar N Hiregange

Madhukar N Hiregange (Expert)

27 December 2010 In this case as the accounting is centralised and ST is being discharged centrally, branches do not require tobe registered. The copy of the application for centralised registration [ where the branch address is also mentioned] and permission/ confirmation from dept maybe kept at the branches.
As a measure fo abundant caution the HO can also chooses to get ISD registration to avoid audit objection, though legally it appears that the same is not necessary.

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