Eligibility of input tax credit

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Swarnasiva Y (Querist)
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03 December 2011 A pharmacitical company is paying to a contractor for the construction of building. Contractor raised a bill by adding service tax (bill amount*30%*4.12%)

Now the question is whether pharmacitical co is eligible to avail cenvat credit on service tax contained in the bill?

PUNEET GOYAL

PUNEET GOYAL (Expert)
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03 December 2011 List of Services Specified Under Rule 2 (1)(ii)(A) of CENVAT credit Rules, 2004
1. Port Services [65 (105) (zn)]
2. Port Services in other port [65(105)(zzl)]
3. Air Port Services [65(105)(zzm)]
4. Commercial or Industrial Construction Services [65(105)(zzq)]
5. Construction of Complex Services [65(105)(zzzh)]
6. Works Contract Services [65(105)(zzzza)]
7. Architect’s Services [65 (105) (p)]
If the above services are used for the
(a) construction of a building or a civil structure or a part thereof; or
(b) laying of foundation or making of structures for support of capital goods
then these services shall not be considered as input services and accordingly CENVAT credit shall not be allowed. In other words, if the above services are used for provision of services other than construction etc in clause (a) & (b) then they shall be included in the definition of input services and accordingly CENVAT credit shall be taken.

The above provision are applicable from 01.04.2011.

It is evident from above analysis that u can not avail CENVAT credit.

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