Service tax credit can avail to pay central excise duty

Yes you are correct, provided that the ownership is transferred to the buyer once the semi finished product leaves the factory gate.

Sir,

Till erection, commissioning & handing over the entire plant to our customer it is our responsibility.  Kindly give any reference Notifications / Circulars / Case Laws

If that be the case, then you also will have to charge Service tax on the erection and commissioning part, provided you are not paying excise duty on the finished product. As this is a service which your providing to your customer, you will have to pay service tax on the said amount. You can refer to the illustrations as mentioned in the Central Excise Act in relation to the definition of manufacture. Hope it sorts out your query.

Yes, we are paying Central Excise Duty on Finished good value while clearing goods to customer.  Coming to Erection activity done at customer place through sub vendor, for which activity we are charging to customer extra + Service Tax. 

Then there is no non compliance and tax evasion on the same.

Thank you for you suggestion, still i am doubt which i am Transfering credit and availing credit process at our manufacturing unit,

Cenvat Credit Rule as "all such goods which are directly or indirectly in relation to the manufacture of the final products"

As per above defination (before 1.4.2011) which i am availing credit post manufacturing (credit receiving on erection commissiong activity) more over there is no connectivity of Manufacture of Final Product.

In this context are we eligible the Credit at our manufacturing unit ?

 

Put your query in bullets, then I will be able to understand that precisely that where you are stuck.

1. Thank you for you suggestion,
2. Continuation to of my first thred still i am doubt which i am Transfering credit and availing credit process at our manufacturing unit,
3. Defination of Cenvat Credit Rule  "all such goods which are directly or indirectly in relation to the manufacture of the final products" before 1.4.2011
4. which i am receiving credit post manufacturing activity (credit receiving on erection commissiong activity)
5. more over there is no connectivity of Manufacture Final Product.
6. In this context are we eligible the Credit, which we are getting service tax credit on erection on commissioning activity?

Based on your above query, the following points need to be looked upon:- 1) A manufacturer can avail CENVAT credit of duty paid on inputs and input services 2) As per CCR, 2004 Definition of both input and input services are different. In the present case you need to refer to the definition of input services. 3) The type of transaction in which you have entered you are paying excise duty at the time of removal from the factory for the finished products and not the main assembled product and i.e for the parts which are cleared form your factory. Now, for erection job either you need to charge service tax or Excise duty deeming it as the process of manufacture. 4) Irrespective of which duty is being charged by you, the process of sub contracting is forming part of the main job. Hence, you will be liable to CENVAT credit as the job is in relation to sub contracting of the main job on which either service tax or excise duty has been paid.