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Service tax - input credit

manish kedia (yet not) (319 Points)

16 April 2014

DEAR ALL

MY CLIENT HAS RENTED ITS PREMISES IN MALL X TO ANOTHER PARTY. HE IS RECEIVING MAINTENANCE CHARGES(Rs. 16854/- INCLUDING SERVICE TAX) WHICH IS REIMBURSEMENT OF MAINTENANCE CHARGES OF THE MALL. MY CLIENT IS PAYING THE SAME TO THE MALL. NOW THE TENANT IS ASKING TO ISSUE A BILL FOR MAINTENANCE AS HE IS NOT BEEN ABLE TO TAKE CREDIT OF SUCH SERVICE TAX PAID ON MAINTENANCE BECAUSE BILL IS IN MY CLIENT NAME. PLEASE SUGGEST THAT IF HE ISSUE BILL THEN WHETHER HE CAN TAKE CREDIT OF SUCH SERVICE TAX. IF THERE IS ANY OTHER WAY LIKE NOC , ETC THEN PLEASE GUIDE.

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Hadi Husain Husaini (IDT Consultant) (99 Points)
Replied 17 April 2014

Service tax paid on security services received for property on rent, service tax paid on society maintenance charges of rented property would be allowed as Cenvat credit against service tax payable on renting of immovable property.

The CENVAT Credit on service tax on maintenance charges can be availed only by a person provideing services falling under purview of " renting of immovable property", if such maintenance charges are taken for maintaining the said immovable property.

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