Input service credit
This query is : Resolved
09 July 2012
whether the tax paid on bank charges can be claimed as credit in a service organisation?
09 July 2012
Yes, you can read Rule 2(l) of CENVAT Credit Rules, 2004 for detail. You can take credit of it.
09 July 2012
already gone through it but not clear can u please elaborate?
09 July 2012
Bank charges are not directly related to providing output service, then how can we claim the credit?
10 July 2012
Relevant Provision are as under:
“input service” means any service, -
(i) used by a provider of taxable service for providing an output service; or
(ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal,
and
includes services used in relation to modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises,
advertisement or sales promotion, market research,
storage upto the place of removal,
procurement of inputs,
accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services,
inward transportation of inputs or capital goods and outward transportation upto the place of removal;
but excludes services,-
A....
B.....
C......
It is clear from above definition that input services includes all office, administrative and selling expenses. Expressly it includes financing charges also. Accordingly i conclude that you can avail the cenvat credit on bank charges.
For any services to be included in the definition of input service, it is not mandatory that it should be direclty used for provision of output services.
I hope above is sufficed for you.
If you are satisfied by my reply then say thanks by clicking on thanks user icon.
“input service” means any service, -
(i) used by a provider of taxable service for providing an output service; or
(ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal,
and
includes services used in relation to modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises,
advertisement or sales promotion, market research,
storage upto the place of removal,
procurement of inputs,
accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services,
inward transportation of inputs or capital goods and outward transportation upto the place of removal;
but excludes services,-
A....
B.....
C......
It is clear from above definition that input services includes all office, administrative and selling expenses. Expressly it includes financing charges also. Accordingly i conclude that you can avail the cenvat credit on bank charges.
For any services to be included in the definition of input service, it is not mandatory that it should be direclty used for provision of output services.
I hope above is sufficed for you.
If you are satisfied by my reply then say thanks by clicking on thanks user icon.
Message likes :
1 times
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Price inclusive or exclusive of GST while made entry in P& L Account
- Gst registered proprietorship firm
- TDS Challan - change of FY 2025-26 to TY 2026-27
- Minimum tax payable to file Updated return
- Applicability of GST on Salary Reimbursement Component
- AUDITOR APPOINTMENT FOR THE YEAR ENDING MARCH 27
- Dep. as per companies act
- Change Of Karta In Case of Death
- UDIN ISSUE
- TDS on purchase of under construction property from a reseller
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Starting trading business
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
Quick Links
ARTICLESHIP
15 September 2026
Freelance Taxation Content Writer Intern
Interactive Media Pvt Ltd.
New Delhi
CA Inter
View Details
ARTICLESHIP
21 September 2026
CA Article Assistant
KK & Company Chartered Accountant
Pune
CA Inter
View Details
09 September 2026
Semi Qualified CA / CA Inter - 2 Groups Cleared
Getmyca Consultant Pvt Ltd
New Delhi
CA Inter
View Details
CCI
Pro
CAclubindia
