Service tax input credit

Dear All

Client is a trust

It conducts seminars

Some seminars are taxable and some are not taxable as some are provided free of cost

It avails input credit on input services

my question is whether it can avail input credit on input services availed for providing free of cost services

Thank you

Replies (2)

Dear Viraj,

As per Rule 6 of CENVAT Credit Rules, 2004, CENVAT credit shall not be allowed on such quantity of input service used in or in relation to provision of exempted services.

For taking credit of input services used for providing taxable output services, you may need to refer to sub-rules 2 & 3 of Rule 6 of CCR, 2004.

Dear Viraj

please ignore the reference of Rule 6 in the above reply, it has been wronlgy cited

however, the credit of ST on input services shall still not be admissible if used for such service against which consideration is not being taken

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