input service tax credit

Page no : 2

ajay garg (Service) (74 Points)
Replied 15 November 2007

No. If manufaturer who is engaged in trading activity, credit will not be available to the manufaturer on which services related to trading activity, As per the service tax rule, it is clear cut mention that in or in relation of final product. Hence trading goods is not a final product of the manufaturer. Ajay Garg J.K.WHITE CEMENT WORKS

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Vijay K. Agrawal (Service) (608 Points)
Replied 16 November 2007

you will get credit of cenvat credit paid on GTA for incoming finished goods for trading purpose also. in case of doubt pl mail to me vijay.agrawal @ acccement.com

rutambh (.....) (217 Points)
Replied 16 November 2007

Mr Ajay Garg , Mr Vijay Agrawal and Experts ,

Thanks for reply ,
Here , can we argue that any activities / service relating to business means “ input service” and it will be eligible for Credit ? incase of query - mfg.er (A)is doing trading activity also , in this case mfg.er can availe ser tax paid -GTA for incoming finished goods from other mfg.er(B)?

2(l) “Input service” means any service,-
(i) used by a provider of taxable service for providing an output service; or
(ii) used by the manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products from the place of removal,
and includes services used in relation to setting up, modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, activities relating to business, such as accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security inward transportation of inputs or capital goods and outward transportation upto the place of removal.

MumbaiProperties (Realtor) (38 Points)
Replied 16 November 2007

What are the Input Service Tax Credit that i can get in my Business of Real Estate Consultancy ? I currently get credit of service tax paid on telephone bills and i have got conflicting advice on getting credit for Service Tax paid on my mobile phone bills. Would appreciate if the learned people here can tell me 1. if i can claim service tax input on Cell Phone bills ( I get a consolidated bill for 8 of my cell phone bills given to my staff, under my properietor firm name) 2. Any other input credit that i can avail of ? Regards Ram

ajay garg (Service) (74 Points)
Replied 17 November 2007

Dear Mr. Ram It is very crystal clear vide service tax ciruclar no. 97 / 8 /2007, New Delhi, the 23rd August, 2007 and as per the circular; "admissibility of CENVAT credit on service tax paid in respect of mobile phones. In the Service Tax Credit Rules, 2002, it was prescribed that credit of service tax was admissible only on telephone connection installed in the business premises. A clarification to this effect was also issued vide circular No. 59/8/2003-ST, dated 20.6.2003, in the context of the Service Tax Credit Rules, 2002. However, in the CENVAT Credit Rules, 2004 no such condition has been prescribed. Therefore, w.e.f. 10.9.2004, credit of service tax paid in respect of mobile telephone service is admissible, provided the mobile phone is used for providing output service or used in or in relation to manufacture of finished goods." And further, if any service which is relatated to your business comes under service tax net and you have paid the service tax then you are eligable for service tax credit and can take the set-off at the time of payment of serviec tax. Regards Ajay garg

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Ramesh Kothari (Manager-EOU commercial) (161 Points)
Replied 17 November 2007

if final products is excisable u can get the credit of the same and use towards the payments of excise

Devendra Goyal (Service) (13 Points)
Replied 24 November 2007

Yes, You can awail service tax credit on input services which are used for manufacturing activities. C.A.Devendra Goyal

Ramesh Kothari (Manager-EOU commercial) (161 Points)
Replied 26 November 2007

We r the mines owners and using the GTA services for Removal of goods for exports thru trucks and using the services oftrucks to bringing the inputs ROM(Raw Material) for feefing to the machine from mines and paying the service tax on that as per ur reply that this can be adjusted against the available cenvat credit but our range superintendent not allowing further note that our product is exempted from the excise duty by vitue of notification so this the debatable matter pl give ur advise on this matter

(Guest)

No time limit is prescribed in service tax rule. Hence on or after 10.09.2004, you are eligable for taking the credit.

(Guest)

hello my qst. is that a manufacturing company can get input service tax credit or not and if it can on which services it can include for getting the service

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(Guest)

hello my qst. is that we are manufacturing company of stainless steel products under chapter 72can get input service tax credit or not and if it can on which services it can include for getting the service

(Guest)

we are a manufacturing unit and our final product is s s billets,ss wirerod,ss flanges ,we are paying different type of service tax my question which cenvat credit should we availed?

(Guest)

Can service tax paid on Advertisement expenses be considered by a manufacturing company for service tax input credit?

shyam kishor porwal (Chartered Accountant) (183 Points)
Replied 29 November 2007

Dear Ram, very clearly discussed by Mr. Ajay Garg. I am also quoting a case law decided by Tribunal. The tribunal in the case of Indian Rayon & Industries Ltd Vs CCE 2006 TIOL 1152 (Trib) has held that cenvat credit on mobile phone is available. Thanks for your query.