Cenvat credit of cvd for payment of service tax

The Assessee (A)  is a Registered Service Provider providing Taxable Service and Receiving Taxable Services. The Assessee buy Goods (Not Capital Goods) from an Importers (I) in India.  In Terms of Cenvat Credit Rule "I" is a First Stage Dealer and "A" is a Second Stage Dealer. The Details of Import Duty paid by "I is as under :

Assessable Value = Rs 226

CVD @ 6% = 13.56

Cess @ 3% = .82

Special CVD = 9.62

"I Being First Stage Dealers passess on the Duty CVD @ 6% to "A" ie Second Stage Dealer under a Cover of Invoice. This can also be utilized by "A" The Payment of Service Tax The Queries are as under :

*  How can A Use this CENVAT Credit for Payment of Service Tax

* What are the Records to be Maintained by "A" for Utilization of Cenvat Credit

* "A" Already files ST -3 Return, is there any need to file additional Returns for Cenvat Credit

* if "A" further Wants to pass on the Credit to his Dealers , then what would be the procedure ?

* Is there any requirement of register to be maintained ?

* Is the Dealer of "A" required to do additionally to avail cenvat credit passed on to him by "A" ie second stage Dealer

 

Replies (2)

In your case you are only Trader not manufacturer so that you cannot utilized the Cenvat credit you can only passed such duty. Further in term of service tax your liability to be raised under RCM and you have to pay service tax only in terms of cash and bank and utilized the same further payment of exclude RCM. If having you other observation plz forward the same.

Dear Ankush Pagaria,

If your a service provider and using the imported inputs for providing output taxable service then CVD can be availed as credit.

SAD 4% cannot be availed by Service Providers.

Further, if that service providers himself, if he is doing trading on imported inputs, then the credit cannot be availed and utilized.

And if he wants to pass on the credit , he needs to obtain registration under Central Excise as a Dealer.

Thanks.

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