Credit of rcm

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neha jain (Querist)

04 January 2016 can i avail the credit of RCM service tax?
provided that i have been avail abatement in both services i.e. in construction as well as in goods transport service

CA. Divyansh Agarwal

CA. Divyansh Agarwal (Expert)

04 January 2016 If you are a service receiver and paying service tax on abated value. Then also u can avail cenvat of the amount paid as service tax under rcm restrictions is applicable on service provider where he can not take cenvat of input services if he is availing abatement on output services.

neha jain

neha jain (Querist)

04 January 2016 what if the service receiver is also availing abatement.

CA. Divyansh Agarwal

CA. Divyansh Agarwal (Expert)

04 January 2016 Under section 68(2) liability of service tax is levied on service receiver in some cases however the basic essence remain the same.for eg A provides services to B and charge service tax on abated portion then Mr. A can not claim cenvat of input services received since abatement is provided to excludes costing on which assessee has already paid taxes. hence 2 option are there either to avail cenvat of service on input services or to avail abatement whichever is more beneficial.However Mr. B has nothing to do whether Mr. A is charging on abated rate or not.same in case where service received is liable suppose Mr. B is liable then he can pay service on abated value,however the chain is same only the person liable to pay is change. then such amount paid will be available as cenvat credit to Mr. B.

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