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Service tax cenvat credit

Anoop (Service) (345 Points)

14 March 2009

In a trading co. where it is not possible to biffurcate service tax paid on consultants/contractors/adv. bills, can v get cenvat credit as a full against service tax payable or in some %? If in %, what is the rate of %?

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2 Replies

Madhukar N Hiregange (Chartered Accountant) (39034 Points)
Replied 14 March 2009

The first step is to exclude those services which are used only for trading. The credit on that would not be admissible.

As far as the balnce eligible credit, If only trading activity + taxable services are provided and no exempt services provided, the service tax is available in full.

The absence of any restriction in Rule 6 to credits for taxable category is deliberate.

Where non taxable/ exempt services are provided restrictions under rule 6 would apply.

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CA Sanjog R.Jain (PRACTICING CA) (57 Points)
Replied 15 March 2009

Originally posted by :Madhukar N Hiregange
"	The first step is to exclude those services which are used only for trading. The credit on that would not be admissible. As far as the balnce eligible credit, If only trading activity + taxable services are provided and no exempt services provided, the service tax is available in full. The absence of any restriction in Rule 6 to credits for taxable category is deliberate. Where non taxable/ exempt services are provided restrictions under rule 6 would apply.	"

I have another question if assessee pay the advance and receipent pay the service tax on it , then assessee cantake the credit of service tax against payment of exicse duty, if yes please tell me section /rule no.