Service tax on process amount to manufacture of liquor

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 June 2015 With the removal from negative list, now the service tax would levied on any process amount to manufacture of alcoholic liquor for human consumption.

Needs suggestion on below point:

We are the manufacture of alcoholic liquor and we at mass manufacture it through contact bottling unit.

Now the service tax would levied on amount paid on bottling charges to contract bottling unit. Shall the contract bottling unit claim cenvat credit on amount paid for manpower supply, GTA paid to Dept against this output tax on bottling charges.
Pl suggest

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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16 June 2015 Yes cenvat credit on manpower supply and GTA can be utilized for payment of out put tax on bottling charges.

Querist : Anonymous

Querist : Anonymous (Querist)

16 June 2015 Boss- Kindly forward the relevant extract of service tax act in this respect.
We have taken opinion from our expert that in case of liquor industry,cenvat credit would not be applicable.

Would be great helpful if you kindly share the relevant extract/ notification.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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16 June 2015 That was the provision earlier when no service tax or excise duty payable. In view of budget amendment on applicability of service tax on liquor bottling, as per cenvat credit rules any service tax paid on input service utilized for provision of out put service is eligible for cenvat credit.
See cenvat credit rules.

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