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Input credit under voluntary compliance scheme

Queries 441 views 1 replies

The company wants to pay the service tax under voluntary compliance scheme for the period starting from 2008.

As per rules made under this scheme, the tax liability can’t be discharged by utilizing the input credit.

Therefore it is required to pay full output service tax amount in cash.

 

Whether the company can take the input tax credit for that period ( 2008 to 2012) and utilize these credit in future period?

 

Replies (1)

Assume, A. Service tax payable for service provided 2008-2012 =Rs. 10 lacs B. Cenvat credit of ST & excise available against above = Rs. 5 lacs C. So Net ST payable = Rs. 5 lacs D. Now, in 2013 , you have paid excise duty or/and service tax of say Rs. 20 lacs on some inputs and inputs services.purchased ..and their credit is available for paying ST and excise.... Here since the excise and St credit of Rs. 20 lacs relates to 2013...thatt's why you cannot say to govt that adjust my O/standing liab of St Rs. 5 lacs(as in point C)....meaning thereby you need to settle the NET O/S ST OF RS. 5 LACS under VCES,2013 IN CASH AND ONLY IN CASH .........


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