Gangatharan (Partner) (108 Points)
14 June 2014Dear all,
A company is paying ST RCM on freight( both inward and outward), and car hire charges RCM also.
But the company is not providing any output services. and the company is applicable for excise duty.
Can i adjust that input tax credit against my excise duty payable??
Your suddestion will be appreciated.
Thanks in advance...
aishwarya s raghavan
(student)
(224 Points)
Replied 14 June 2014
Dear Gangatharan,
First of all, service tax paid on GTA and Car hire services under RCM is not eligible input credit, even for adjustment against service tax liability. So, I think the question of adjusting it against the excise duty payable doesn't arise. Hope it's clarified.
Harendra Kumar
(Tax Advisor )
(1326 Points)
Replied 14 June 2014
Yes, you can availed the input tax credit and same is also utilized the further payment of excise duty or service tax exclude RCN. And output service i.e. sale materials send by you through by transport or any kind of.
So there is no question for availment of input tax credit.
JAINENDRA JAIN
(ACS/CA)
(1668 Points)
Replied 14 June 2014
cenvet credit cannot be utilised for payment of service tax under reverse charge mechanism.
however tax paid on reverse charge can be utilised as cenvet credit for being set off with output tax payable
Harendra Kumar
(Tax Advisor )
(1326 Points)
Replied 14 June 2014
JAINENDRA JAIN
(ACS/CA)
(1668 Points)
Replied 14 June 2014
Gangatharan
(Partner)
(108 Points)
Replied 14 June 2014
Yeah leave about car hire charges..
but for freight inward we can avail input tax credit. no issue on that.
so can i use that ST paid amount to discharge my excise liabilty.
and give some clarity regarding input tax credit on freight outward.
Thank u.
Arun Kumar Singh
(GST Advocate)
(15220 Points)
Replied 14 June 2014
If input services are used in the manufacturing of final produts then you are eligible to take cenvat credit but you can not avail the cenvat credit of renting of cab. Outward transportation upto the place of removal is eligible. You can pay the excise duty from inputs, input services and capital goods used in the final product.
Gangatharan
(Partner)
(108 Points)
Replied 14 June 2014
JAINENDRA JAIN
(ACS/CA)
(1668 Points)
Replied 14 June 2014
Arif Ali
(Apt Co Advisory)
(1230 Points)
Replied 15 June 2014
yes service tax paid under reverse charge mechanism can be utilised as cenvat credit for excise duty liability
ajay garg
(Service)
(74 Points)
Replied 15 June 2014
Venkatanarayana GM
(Partner associate at Hiregange & Associates)
(1279 Points)
Replied 16 June 2014
Yes. You can utilize input service for making excise duty payment by way of CCR 2004.
Further, with regard to GTA inward you have to pay and avail credit and use it for making payment of excise duty.
Availing credit of GTA is litigatable , if client is very aggressive you can otherwise better not to avail.
ST payment made for the services received as a Rent - a - cab service, credit cannot be taken as the same is in exclusion clause as per Input service definition as per CCR 2004.
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