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Cenvat credit on service tax

DINU SUKUMAR (Audit Manager) (176 Points)

26 March 2014

Hi Experts,

Can take full CENVAT credit on ST if a works contractor wrongly collects 100% service tax instead of reverse charge at 50%.

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3 Replies

Manoj Mehta (Head Of Department (Accounts & Finance)) (1479 Points)
Replied 26 March 2014

Yes dinu if you have paid it then claim it. Regards

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Manoj Mehta (Head Of Department (Accounts & Finance)) (1479 Points)
Replied 26 March 2014

But it will be better if you make adjustment with party by taking a fresh bill as this case comes under reverse charge. Take back the amount paid to party (50%) . Because your auditor can question you on this.

DINU SUKUMAR (Audit Manager) (176 Points)
Replied 26 March 2014

Hi Manoj,

Thank you for the reply. Auditors question is not relavant here. We are registered private limited company engaged in the business of construction of commercial complexes. One of our subcontractor collects 100% service tax from us and paid to the central government. In this circumstance i need to know that shall we can claim the full amount paid to sub contractor instead of 50%. We also paid 50% under reverse charge. Some of my friends said me that the sub contractors liability is only 50%, that much only we can claim.