According to the Cenvat Credit rules Credit is available only when there is manufacture...the Term used is Manufacture not Manufacturer...Thus if a Service Provider is envolved in Manufacturing then he should be allowed cenvat credit or not...What is your Opinion on the same...
No cenvat Credit is allowed on inputs by the service provider..
But in Case of Capital goods it is allowed ..
Since the Excavator is mentioned in the list of capital goods shouldnt Cenvat Credit be allowed in full for the same...???
As per Rule 3(1) of the Cenvat Credit Rules, 2004 Cenvat Credit is allowed to be taken to A - Manufacturer/producer of final products and B - Provider of taxable service. Thus if you are not engaged in manufacturing of final product(only engaged in some of the intermediary/accilliary process), you are not eligible.
Cenvat credit on inputs is also allowed to Service Providers.
Full Cenvat Credit(upto 50% in the year of acquisition and the rest in subsequent year) is allowed in case of Capital Goods.
Please clarify, the usage to which the equipment is used and whether you are a Central Excise assessee or a service tax assessee, so that query can be answered in the right context.
CAclubindia
