Cenvat credit on gift vouchers

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 October 2013 Dear Experts,

I have a query related to Cenvat Credit on gift vouchers.

There are 4 category of persons in a transaction.

A-Bank
B-Agent of Bank
C-Vendor
D-End Customer (Also customer of Bank)

D being loyal customer of A, gets certain points / vouchers which can be redeemed with C for purchase of goods or availing a service.

A has appointed B as agent to look after all such transactions and has a Principal -Agent relationship.

B has entered into agreement with C, so that C bills B for any voucher redeemed by D. In turn, B bills A and seeks reimbursement for the same.

Other Points:
1. No where under the bill, A's name is mentioned.
2. B does not have any margin in reimbursement. It raises a separate bill for its fees.
Issue:
1. Whether Cenvat can be availed in such case where buyer is end customer, but payment is made by Bank (A).

2. Suppose, in any transaction, Vat is also levied if the end customer purchases goods, can input tax credit be availed.

If yes, by whom and under what provisions.

What will be the scenario, if the agreement is Principal-Principal basis?

Arun Jain

Arun Jain (Expert)
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09 October 2013 First Case- Suppose an individual running a proprietor business get redeem point on his personal saving account and get a TV against redeem points on which there is VAT of Rs.2000. he can not avail this as input credit of vat as this transaction is not because of his business.