Service tax input

This query is : Resolved

Ravi Kumar Rajgaria (Querist)
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16 March 2009 A company paid a bill of Rs. 5 lacs + service tax and book the 5 lac as expenses and service tax amount as input credit. During the FY company couldn't utilise the input credit. Is the debit balance of Input credit ledger allowable expenses in Income tax act?

Shyam Lal Naik

Shyam Lal Naik (Expert)
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16 March 2009 Unless and until the unutilised Cenvat balance is written off, how can it be allowed as an expenditure?

The assessee have to choose either of the two optins, ie. 1. Carry forward the un utilised balance to next year or 2. Write off the balance and claim the same as an expenditure, in my humble opinion.