Cenvat credit

This query is : Resolved

CA. Jyoti Baid (Querist)
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04 August 2010 Respected All,

Our company has paid advance on account of an input service along with the amount of service tax in the month of July.

The company will utilise the input service in the month of December.

When can the company claim cenvat credit, in the month of July or in the month of December.

Regards
Jyoti

Jyoti

VINOD ARORA

VINOD ARORA (Expert)
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06 August 2010 Input credit should be taken/claimed in the month of July itself and Half yearly return for September should show this amount as pending offset amount. This may be utilised in the month of December.

However, in case there is omission in claiming credit in July, the same may be taken/claimed and utilised in December as well. However, it should not cross over to next financial year to avoid complications.

BALU V

BALU V (Expert)
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13 August 2010 As soon as the ST was paid to the client the credit can be availed if otherwise eligible. There is no restriction in utilizing the same in the month of July itself. Receipt of service doesn't matter.

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Gagan Agarwal

Gagan Agarwal (Expert)
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31 August 2010 under the CENVAT Credit Rules, 2004 input service has been defined to mean taxable services used by a provider of taxable service to provide taxable services.

Accordingly, service tax paid on input services can be claimed only in the month of December (ie when the services have been used by the service provider)and not on advance payments (ie in July).