Input on carriage Inward
This query is : Resolved
09 July 2011
A company is paying service tax on Freight outward and inward both after rebatement.
Company is not taking the input credit of service tax on Freight inward as there is no other source where it utilize the credit.
Is service tax is refendable for normal industries.......?????
Give ur comments is company doing right...??????
Give answer with proper schedule and rule otherwise don't give
Company is not taking the input credit of service tax on Freight inward as there is no other source where it utilize the credit.
Is service tax is refendable for normal industries.......?????
Give ur comments is company doing right...??????
Give answer with proper schedule and rule otherwise don't give
09 July 2011
input credit available only when output service goods are taxable and tax is payable under service tax or excise,
when the dealer is under exemption of service tax and excise, such service tax paid as service tax receipent is neither refundable nor adjustable anywhere,
when the dealer is under exemption of service tax and excise, such service tax paid as service tax receipent is neither refundable nor adjustable anywhere,
09 July 2011
IS there is any exemption to the SEZ unit in case of service tax on GTA services
09 July 2011
no , they can claim back the service tax, subject to the their specified SEZ comm advise
10 July 2011
Here a SEZ unit is paying the service tax on carriage inward..........no other output service is provided by the unit........
Can they avail the input of this service tax credit and if yes then is it refundable....???????????
Please provide the list of exemptions for
specified services for SEZ units..
Can they avail the input of this service tax credit and if yes then is it refundable....???????????
Please provide the list of exemptions for
specified services for SEZ units..
01 August 2024
### **Input Credit on Carriage Inward and Freight**
#### **1. General Rules for Input Credit on Carriage Inward:**
Under the Service Tax regime:
- **Carriage Inward:**
- **Eligibility:** Input credit on service tax paid on carriage inward (freight charges for bringing goods to your premises) can generally be claimed if the services are used for business purposes.
- **Rule 2(l) of the CENVAT Credit Rules, 2004:** States that credit can be availed on input services used in or in relation to the business.
- **Refundability:**
- **Service Tax Refunds:** For normal industries (non-SEZ), service tax paid on input services can be claimed as credit and adjusted against output tax liabilities. Refunds are typically not applicable if there is no output service or the company does not make taxable supplies.
#### **2. SEZ Units:**
For SEZ units under the Service Tax regime:
- **Input Credit:**
- **Eligibility:** SEZ units are generally allowed to claim input credit on service tax paid on services used to provide their output services. This includes services like carriage inward if they are used in the course of business operations.
- **Notification No. 9/2009-ST:** Provides that services provided to SEZ units are eligible for input credit, which can be utilized to offset service tax liability.
- **Refund:**
- **Rule 5 of the CENVAT Credit Rules, 2004:** If an SEZ unit does not have any output service, they can claim a refund of the service tax paid on input services. This refund is applicable under the prescribed procedure.
#### **3. Exemptions for Specified Services for SEZ Units:**
SEZ units are granted various exemptions and concessions on service tax:
- **Notification No. 12/2013-ST:** Lists the exemptions available for services provided to SEZ units.
- **Notification No. 17/2011-ST:** Provides for refunds on input services utilized by SEZ units.
**Examples of Exemptions Include:**
- **Services Received by SEZ Units:** Services like renting of immovable property, business support services, etc., are eligible for exemptions.
- **Input Service Tax Credit Refund:** SEZ units can claim refunds for the service tax paid on input services under certain conditions if there are no corresponding output services.
#### **Summary for Your Situation:**
- **Normal Industries:** Service tax paid on carriage inward can be claimed as input credit and utilized against output tax liability. Refunds are generally not applicable unless there is no output service.
- **SEZ Units:** Can avail of input service tax credit on carriage inward and claim a refund if there are no output services or if they qualify under the specified rules.
**Proper Procedures:**
1. **For Normal Industries:** Ensure compliance with CENVAT Credit Rules, and use input credits against output tax.
2. **For SEZ Units:** Follow the refund procedures under Rule 5 of the CENVAT Credit Rules, 2004, and refer to relevant notifications for detailed guidelines.
**Documents and Compliance:**
- Maintain proper documentation and invoices for service tax payments.
- Ensure compliance with the prescribed notifications and rules for claiming credits and refunds.
For the most accurate and detailed guidance, always refer to the latest notifications, rules, and consult with a tax professional or legal advisor.
#### **1. General Rules for Input Credit on Carriage Inward:**
Under the Service Tax regime:
- **Carriage Inward:**
- **Eligibility:** Input credit on service tax paid on carriage inward (freight charges for bringing goods to your premises) can generally be claimed if the services are used for business purposes.
- **Rule 2(l) of the CENVAT Credit Rules, 2004:** States that credit can be availed on input services used in or in relation to the business.
- **Refundability:**
- **Service Tax Refunds:** For normal industries (non-SEZ), service tax paid on input services can be claimed as credit and adjusted against output tax liabilities. Refunds are typically not applicable if there is no output service or the company does not make taxable supplies.
#### **2. SEZ Units:**
For SEZ units under the Service Tax regime:
- **Input Credit:**
- **Eligibility:** SEZ units are generally allowed to claim input credit on service tax paid on services used to provide their output services. This includes services like carriage inward if they are used in the course of business operations.
- **Notification No. 9/2009-ST:** Provides that services provided to SEZ units are eligible for input credit, which can be utilized to offset service tax liability.
- **Refund:**
- **Rule 5 of the CENVAT Credit Rules, 2004:** If an SEZ unit does not have any output service, they can claim a refund of the service tax paid on input services. This refund is applicable under the prescribed procedure.
#### **3. Exemptions for Specified Services for SEZ Units:**
SEZ units are granted various exemptions and concessions on service tax:
- **Notification No. 12/2013-ST:** Lists the exemptions available for services provided to SEZ units.
- **Notification No. 17/2011-ST:** Provides for refunds on input services utilized by SEZ units.
**Examples of Exemptions Include:**
- **Services Received by SEZ Units:** Services like renting of immovable property, business support services, etc., are eligible for exemptions.
- **Input Service Tax Credit Refund:** SEZ units can claim refunds for the service tax paid on input services under certain conditions if there are no corresponding output services.
#### **Summary for Your Situation:**
- **Normal Industries:** Service tax paid on carriage inward can be claimed as input credit and utilized against output tax liability. Refunds are generally not applicable unless there is no output service.
- **SEZ Units:** Can avail of input service tax credit on carriage inward and claim a refund if there are no output services or if they qualify under the specified rules.
**Proper Procedures:**
1. **For Normal Industries:** Ensure compliance with CENVAT Credit Rules, and use input credits against output tax.
2. **For SEZ Units:** Follow the refund procedures under Rule 5 of the CENVAT Credit Rules, 2004, and refer to relevant notifications for detailed guidelines.
**Documents and Compliance:**
- Maintain proper documentation and invoices for service tax payments.
- Ensure compliance with the prescribed notifications and rules for claiming credits and refunds.
For the most accurate and detailed guidance, always refer to the latest notifications, rules, and consult with a tax professional or legal advisor.
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