Service tax credit on mobiles in name of employee

Hi Experts, There is a Salary component - Telephone which forms part of Employee CTC. The phones (Landline or Mobile) is in the name of Employee which is used for personal purpose and no relevance to business of employer. Lets assume its Rs.3000 pm. There are 2 ways of getting the Salary Component:- 1. Take it as fully taxable Rs.3000 every month in Salary. 2. Provide Telephone bills (say Rs.2000) and get that component as tax free and balance Rs.1000 as taxable component. The query is whether Company can claim Service Tax credit on the Reimbursements (service tax on Rs.2000) part which forms a salary component. Would appreciate your expert opinion
Replies (1)

No Credit as the such services are not used for providing taxable output service.

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