Cenvat credit of capital input used for construction of buil

Others 977 views 2 replies

Hello, is it possible for a person providing renting services to claim credit of excise duty paid on the construction material against the liability of service tax orising on renting of immovale property ?

 

Replies (2)

No Dear, A person can not claim cenvat paid on account of Excise duty on material used for constructions of property.

Bcoz as per the definition of input given under Cenvat credit rules, 2004, its goods should be used for providing output services. Here materials are used for constructions of property and not for providing output services. Definition is given below for ur reference.

 

"input" means- 

 

(i)

all goods, except light diesel oil, high speed diesel oil and motor spirit, commonly known as petrol, used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not and includes lubricating oils, greases, cutting oils, coolants, accessories of the final products cleared along with the final product, goods used as paint, or as 
packing material, or as fuel, or for generation of electricity or steam used in or in relation to manufacture of final products or for any other purpose, within the factory of production;

 

(ii)

all goods, except light diesel oil, high speed diesel oil, motor spirit, commonly known as petrol and motor vehicles, used for providing any output service;

 

 

Explanation 1.- The light diesel oil, high speed diesel oil or motor spirit, commonly known as petrol, shall not be treated as an input for any purpose whatsoever.

 

 

Explanation 2.- Input include goods used in the manufacture of capital goods which are further used in the factory of the manufacturer; but shall not include cement, angles, channels, Centrally Twisted Deform bar (CTD) or Thermo Mechanically Treated bar (TMT) and other items used for construction of factory shed, building or laying of foundation or making of structures for support of capital goods;

 

In case the same property is being used for providing the renting services, then also this limitation would apply.


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