Cenvat credit, Service Tax

[N Balachandran]

 

Dear Sir,

Under the Cenvat Credit Rules 2004, a service provider is entitled to claim the benefit of cenvat credits in respect of the excise duties paid on capital goods and the service tax   paid on    input services used for providing output service.  Where the usage is for  providing exempted service, the credits would not be admissible. Precisely for this reason the   service provider would be required to ensure proper usage of input services and avail credits on those input services used for  use of input services  for the provisions of output service excluding exempted services . 

My question is  When the service provider pay the service tax against the services which are common input services, How, the CENVAT credit to be claimed by the Service provider? what is basis for claiming CENVAT credit?.  N.Balachandran 

Posts / Replies

[Naveed S]

 

Answer to Query is already discussed at ISSUE ID NO - 3996 Dated: -06-04-2012. During the last one year period, there are no changes in the cenvat rules on the said issues.

[KAMARAJ RENGARAJ]

Dear Sir,

When inputs are used commonly for both taxable and non-taxable, the Government feels that the cenvat availed should be restricted to the taxable portion alone.

Please study rule 6 (2) & 6 (3) of  Cenvat Credit Rules where the options are available to apportion the duty amount to the exempted commodities and taxable.

 regards,