| Originally posted by :CA. B.K.BANSAL | ||
| " | Whether a company can avail credit of service tax on Construction bill of Factory Building. The contractor charges service tax 12.36% on 33% value of total bill amount. ( after availing 67% abatement). Whether we claim credit of service tax. | " |
Dear Sir,
The 67% of abatement matter is related to your contractor. He avails the benifit under notification no. 1/2006 dated 01.03.2006 (as amended) subject to the condition ' no cenvat credit on inputs, input services and capital goods should not be used'. And he is paying the service tax on 33% of the service value.
As far as you are concerned, you are the receipent of construction service in relation to your factory building, and the service covers under input service. Hence you can avail the CENVAT credit on the same. It is immaterial to you whether your contractor getting abatement benifit or not.
CAclubindia
