CA. Manthan Ruparelia (Chartered Accountant) (94 Points)
22 July 2011One of Mine client (Pvt Ltd Co) is providing renting of immovable property service which is taxable service, Can he take cenvat Credit of Input Service Received Such as Commission Paid for Trading activity, Rent paid for Retail shop,etc
Or is there is any restriction for cenvat credit on Renting of Immovable property.
E.KALAIKOVAN
(Sr. Accounts Manager )
(344 Points)
Replied 22 July 2011
Cenvat Credit Rule do not require input-output relation. All activity relating to business fall within the defination of "Input Service". Hence they can take CENVAT Credit from any type of Taxable service.
CA Unnikrishnan Nair N
(Chartered Accountant)
(2083 Points)
Replied 22 July 2011
Services which have nexus with the renting of property service qualify for cenvat credit. commiision paid for trading and rent paid for retail shop do not seem to have such nexus.
CA. Manthan Ruparelia
(Chartered Accountant)
(94 Points)
Replied 22 July 2011
@ Nair sir, Thanks for your response. But The assesse is engage in Retail Business. And it has few Immovable property which is rented out. so will he eligible for cenvat of said expenses or admin expenses such as Telphone, etc
CA Unnikrishnan Nair N
(Chartered Accountant)
(2083 Points)
Replied 23 July 2011
Input services in realtion to retail business may not qualify for cenvat credit that can be availble for renting of property services. Telephone service can be taken for cenvat credit provided the service has been utilised in relation to renting of property services.
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