credit availment

during an audit of an infrastructure company i found that the accountants are availing input credit of service tax paid on telephone bills and on the fooding bills of restaurant.

is it correct? can they avail credit on such expenses?

Replies (6)

Yes, A (Manufacturing)Excise Company May Avail Credit for Service Tax paid on Telephone Expenses Used in Its Factory Not on Its Office.

But Can't Claim on fooding bills of restaurant.

I Mean that the expenses incurred for manufactuing purpose in factory, if on which service tax is paid, then the credit may b availed by manufacturing entity.

thanks ayush for replying me. but plz can u let me know if their is any circular or any notification for such. actually if i argue with my client than i have to do that with proper base.

I Don't Hav Any Circular or Notification Regading This.......Sorry For That.

 

But This is Sure from My Side.a

ok thanks...

You can take cenvat credit on service tax paid on telephone bills and rastaurant bills.

Hi,

There is no need for having separate circular. Once the eligibility of "Input", "Input service" and "Capital Goods" is satisfied under Cenvat Credit Rules, 2004 one can take credit.

Here, one may note that the entire amount of credit of service tax paid on telephone may not be available if manufacturer is engaged in manuafcture of dutiable as well as taxable goods (Refer Rule 6 fo Cenvat Credit Rules)

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