Service Tax on Freight paid on Inputs purchased

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 April 2010 Dear Sir,

We are paying the freight on Inputs purchasing, we want to know the rate of service tax to be deducted and can we take the cenvat credit of the same in our excise books.

Himanshu

Himanshu (Expert)
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18 April 2010 Yes you are paying s.tax on input freight & same will be credit taken & this credit will be adjusted against cenvat.

Querist : Anonymous

Querist : Anonymous (Querist)

19 April 2010 I think u have left the question part i.e At which rate service tax to be deducted from the transporter.

Himanshu

Himanshu (Expert)
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19 April 2010 Ya u r right. I m sorry,
The 75% abadment on service tax rate [10%]condition is if the transporter is not Registred with central excise & does not taken facility of cenvat credit. now in this case you pay the service tax @ 2.5% on the freight amount.

in case the transporter is taking credit facility of cenvat you will pay the service tax @ 10%

in both case you will refund the amount of service tax & adjust this amount agst cenvat duty payable.

Querist : Anonymous

Querist : Anonymous (Querist)

19 April 2010 Thanks for ur reply.

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