Cenvat-srvice tax
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
21 October 2013
Can avail cenvat credit of Service tax for 2012 in 2013 on payment of service tax
Suresh Ramaswamy
(Expert)
21 October 2013
CENVAT credit can be availed of either on accrual basis or on cash basis.
In case CENVAT credit is availed of on the basis of receipt of invoice / entry in the books of account, then that invoice should be paid off within 90 days. Failure to do so involves reversal of the availed input and payment thereof in cash alongwith interest, irrespective of whether the CENVAT credit is utilized or not.
The safer course would be to avail of the CENVAT input credit on payment basis. In that case whenever an invoice is paid off the CENVAT input credit is availed off.
Accordingly, if availing of CENVAT credit is done on payment basis, then in spite of the invoice pertaining to 2012-13, the payment having been made in 2013-14, the CENVAT input credit can be availed of during 2013-14, which will be as per law.
In case CENVAT credit is availed of on the basis of receipt of invoice / entry in the books of account, then that invoice should be paid off within 90 days. Failure to do so involves reversal of the availed input and payment thereof in cash alongwith interest, irrespective of whether the CENVAT credit is utilized or not.
The safer course would be to avail of the CENVAT input credit on payment basis. In that case whenever an invoice is paid off the CENVAT input credit is availed off.
Accordingly, if availing of CENVAT credit is done on payment basis, then in spite of the invoice pertaining to 2012-13, the payment having been made in 2013-14, the CENVAT input credit can be availed of during 2013-14, which will be as per law.
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