Cenvat credit in pre opening hotels

Queries 841 views 2 replies

Deepak Baghel

Accountant

74 Points Joined May 2009

My company engage in hospitality inductry and will open a 5 Star Hotel. Hotel is in contruction stage since 2009 and will complete in 2014. We are taking place so many work orders to the contractors for civil construction as well as for equipment installation. Contractor are charging service tax on their running bills. And we are also taking services of Archtects. They are also charging service tax on their invoices

Our Hotel will provide output service like reneted accomodations, restaurents services & beauty parlour etc. and will charge service tax on these services.

Whether we can take CENVAT credit on work contract and architect services received.

Replies (2)

Saurabh Maheshwari

B.com ACA

5923 Points Joined December 2011

A BIG NO .....because as per Ammendment made by Finance Act ,2012 to the definition of inputs and input services to exclude services & goods used in construction of Immovable properties . In short, Cenvat credit of ST & excise paid for services & goods used in construction of Immovable properties will not be allowed.....

Yes , before the specific ammnedment the cenvat credit was admitted to Oberoi Mall P Ltd, by Hon'ble CESTAT, New Delhi.But the ammendment has overruled that case.