Cenvat credit

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Service tax paid by the Co. for restaurent /hotel expenditure incurred by the employee,  can co. avail the CENVAT CREDIT ON SUCH EXPENDITURE.

Replies (7)

If the expenditure relates directly/indirectly to the manufacturing process then only Cenvat Credit can be claimed.

As per the revised definition of Input services under Cenvat Credit Rules, cenvat on the staff welfare activity incurred by the employee for their personal consumption can not be claimed by the company as Cenvat credit. Hence, in my opinion, no cenvat can be claimed in such case.

From 01.04.2011, input service definition has been changed and the words "activities relating to business" have been removed from the definition.  It is not advisable to avail credit on these services.

No...............................

If the expense is in the nature of staff welfare....thn NO.....but if the expense is shown as sales promotion for the company....like lunch or dinner with client thn....sales promotion is specifically included in the defination of input service....hence the company can take the credit provided he is a mfg of final product or a provider of an taxable service....

 

you can avail the cenvat as per Defination of  "Input service" u/r 2 of Cenvat credit rules,2004 "(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,.............

 

 

Originally posted by : Rai singh Tomar

 

you can avail the cenvat as per Defination of  "Input service" u/r 2 of Cenvat credit rules,2004 "(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,.............

 

 

Please refer to the whole definition...


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