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Service tax

Jayshree Chavan (Auditor) (233 Points)

31 August 2016

Can we take input credit of service tax paid as service receiver under reverse charge on security charges against service tax liability and which is the notification for availability or non availability of input credit of service tax paid on security charges???

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Sunil Kumar (Indirect Taxation ) (1246 Points)
Replied 31 August 2016

Hi Jayshree Chavan ,

Yes, you are entitled to take credit of same.There is no as such specific notification to it but you need to refer to definition of Input service provided under Cenvat Credit Rules and i am quoting the same;

(l) 􀀧input service􀀭 means any service, -

(i) used by a provider of output service for providing an output service; or

(ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products up to the place of removal, and includes services used in relation to modernisation, 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 pl ace of removal, procurement of inputs, accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation up to the place of removal; but excludes,-

(A) service portion in the execution of a works contract and construction services including *[service listed under clause (b) of section 66E of the Finance Act] (herein referred as specified services) in so far as they are used for 􀀻

(a) construction or execution of works contract of a building or a civil structure or a part thereof; or

(b) laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or

(B) services provided by way of renting of a motor vehicle, in so far as they relate to a motor vehicle which is not a capital goods; or

(BA)service of general insurance business, servicing, repair and maintenance, in so far as they relate to a motor vehicle which is not a capital goods, except when used by 􀀻

(a) a manufacturer of a motor vehicle in respect of a motor vehicle manufactured by such person; or

(b) an insurance company in respect of a motor vehicle insured or reinsured by such person; or

(C) such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee.

Explanation- For the purpose of this clause, sales promotion includes service by way of sale of dutiable goods on commission basis

Hope, I am clear.

Regards

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