Input of services tax

The Service Tax in respect of services provided or agreed to be provided by individual advocate or a firm of advocates by way of legal services is payable by the service recipient under Reverse Charge Mechanism.

The service recipient can avail Cenvat Credit of such Service Tax as the "Legal Services" are covered under the definition of 'input services'

INPUT SERVICE

Sec. 2 (1) of the CENVAT Credit Rules, 2004 defines “input services” and states that

“input service” means any service, –

(i) used by a provider of taxable service for providing an output service; or

(ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto the place of removal,

and includes

services used in relation to setting up, modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation
upto the place of removal;