Service tax

This query is : Resolved

KUMAR KRISHNAN (Querist)
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14 April 2013 Dear All,

RCM servcie Paid, whether we can able take input out not.

if can please send the detials provision or notification.

please help me.

CA Vikas Acharya

CA Vikas Acharya (Expert)
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14 April 2013 As per Rule 3(1) of CCR, only output service provider or manufacturer is allowed to take ccr and can be used for payment of out liability, also same as per 2(l)of CCR rules i.e, Input Service.
Hence ccr will be allowed to only those SR(service recepient), who themselves are service provider, not to a retailer because for them the service is not be Input Service in terms of 2(l).

CCR will be allowed of total tax paid by SP(service provider) and SR(service receipient) as ultimately paid from the pocket of SR, but that CCR cannot be used to pay off the reverse charge liability by SR as that is input service, though can be used on other output liability on output service.

Explained by..
Newly inserted: Explanation to Rule 3(4) of CCR provides that “CENVAT Credit cannot be used for payment of service tax in respect of services where the person liable to pay tax is the service recipient.” Therefore, SR has no option but to make payment of ST and claim the same as CCr thereafter.

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