27 February 2009
Dear Sir, I am working in M/s.SOUTHERN BATTERIES PVT.LTD, as an Excise Exedutive since seven years. Last week (14.02.09) our I.A.P.Audit was conducted and was over on 18.02.09. I have taken CREDIT of Service Tax against Effluent Treatment.But audit party objected against the credit and also send us a SHOW CAUSE NOTICE. Now I would like to know wheather cenvat credit credit of effluent treatment is elegible or not. Now I would like to inform you what is effluent treatment.We product Tubular Batteries. After making negative plates we formated the plates other wise it will not work. While formation process is going on that time we do electrolysis with water and Acid.After formation completed we make treatement the acid mixed water so that the water become normal water and again we can not use the water but throw out side. All this process is done by other Co. This work we call effluent Treatment. Hence I request you kindly let me know wheather this credit can we take or not. Thanking you, Yours faithfully, Ramgopal Dutta, for SOUTHERN BATTERIES PVT.LTD BANGALORE.
27 February 2009
Your goodself has stated " All this process is done by other Co"
Please clarify whether the service bills are in your company name raised by this other co.
If the above is affirmative then you can very well take the credit as the Act states that all business expenses are eligible for Input Credit.
Moreover the Cenvat Credit Rules specifically include Effluent treatment plant as being eligible for input credit, therefore all expenses related to the ETP stand eligible for input credit.
Please refer to the Service tax Cenvat credit rules, which are self explanatory in this reqard
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