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CENVAT credit on mobile

This query is : Resolved 

04 July 2007 can CENVAT credit be taken in respect of service tax paid on mobile bills

it is not specified in Circular No. 59/8/2003 that credit on mobile bills cannot be taken in Service Tax Act by Taxman

04 July 2007 credit will be allowed only on telephone sets installed in the business premises. Mobile phones are not covered

04 July 2007 Dear Mr. Jain,

Rule 3(6) of erstwhile Service Tax Credit Rules, 2002 read as:

"Service tax credit on the service provided in relation to telephone connection shall be allowed only in respect of such telephone connections which are installed in the premises from where output service is provided."

The Service Tax Credit Rules, 2002 has been substituted by CENVAT Credit Rules, 2004 vide notification no. 23/2004-CE(NT), dated 10-09-2004. The new Rules does not contain any prohibition to take credit of service tax paid on mobile phone. Hence cenvat credit on moblile phone is available w.e.f. 10-09-2004.

Service Tax paid on mobile phone has been held to be eligible for cenvat credit in the case of Indian Rayon & Industries Ltd. vs. CCE Bhavnagar 2006 (4) STR 79 (Tri-Mumbai)

05 July 2007 I totally agree with the reply of Mr. Shyam Lal Naik

05 July 2007 I totally agree with the reply of Mr. Shyam Lal Naik & Mr. Amit Thapar.

Any more opinion on matter is welcome.


05 July 2007 Does it make any difference if the mobile is a pre paid one?

05 July 2007 in pre-paid mobiles there is no invoice on basis of which cenvat credit can be taken.

you can take cenvat credit on Pre-paid mobiles if u can produce invoice containing such particulars that are prescribed

09 July 2007 I agree with the reply of Mr. shyam lal Naik and i would like to add one more point.

The bill must be raised in the name of the Company and not in the name of the employee.


10 July 2007 Any more comments or suggestions????

13 July 2007 I guess there can be no other view to what mr shyam lal naik has stated... the query is well resolved...



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