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HABEEB (Querist)

09 December 2010 My query is related to service provided by 'Authorised service stations' ( 4 wheeler). We provide service even to customers of co-dealers who get their vehicles serviced with us for their convenience. These vehicles may be provided service free of cost because they might be having free service coupons provided by the manufacturer.Therefore money is not collected from the customer ie, he is not billed. Therefore no service tax liability. But this amt is later on collected from the dealer from whom the car has been purchased by the customer inclusive of service tax, so the service tax liability arises for us.
My question is can we take input credit in case of we paying money to some other authorised service station for their provision of service to our customer free of charge???Our CTO says we can't...please provide proper advice including reference to case laws. Thank You.

Madhukar N Hiregange

Madhukar N Hiregange (Expert)

12 December 2010 why not? CTO is not the proper officer also. As long as the input service is for the prupose of provdinjg the output services on which service tax is paid it would be admissible.

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