23 October 2012
We are 100% EOU and we are claiming service tax refund. Service Tax Dept had refund us service tax amount for the last quarter of 2011-12 excluding the service tax of Rs.19,386/- paid on Group Health Insurance Premium of our employees stating that it is not input service nor has any nexus with output service exported. The High Court further held that under the scheme of CENVAT Credit Rules, 2004, the service tax paid on all those services which the assessee has utilized directly or indirectly in or in relation to the final product is entitled to claim the credit. It is evident that the assessees are entitled to avail CENVAT credit of the service tax on Group Medical Policy and Group Insurance Health Policy.
Please let us know whether we should go for appeal or not.
23 October 2012
Service tax paid on services for personal consumption of employees like mediclaim, group insurance are specifically not allowed for input tax credit as per the latest definitions. Definitions have been specifically amended to avoid litigations. So I am not much confident on claims made by you above.
CAclubindia
