Water supply by water tanker for industrial/construction work, Service Tax

[Sanjay Vasava]

Dear Sir,

One party is supplying water to us for industrial construction work in industry. Bill description written on the bill as Water Supply With Water Tanker.

Somebody advised me is needed to be corrected in bill description as Water Supply With Water Tanker for Industrial purpose.Otherwise we cannot avail CENVAT Credit.

Please explain.

Thanks & Regards,

Sanjay Vasava

Posts / Replies

[Himansu Sha]

If you have received the services and the services are relating to industrial construction works, there must have been other evidences to prove it. Writing some thing more on the invoice is not wrong, but this is not a ground for denying credit.

[KASTURI SETHI]

No need to correct the bill. Your business will speak and there would be no problem in availing credit on this bill, if other wise credit is admissible. Nexus input service and output service is required. If excisable goods are being manufactured, then nexus between input service and dutiable final product is required to be established.

[MUKUND THAKKAR]

Water Supply With Water Tanker .

description seems water supply with tanker . need to change description likes water supply for industrial use. by which mode you delivered is not important.

[KASTURI SETHI]

With due respect to Sh.Mukand Thakkar, Sir I further express my views as under:-

The phrase "For Industrial Use or Industrial Purpose' is very much relevant in Central Excise wherein it means that good are not meant for further sale but for industrial consumption in manufacture of an other excisable product in another factory, may be sister concern or other units. 'Supply of water' is service and no manufacturing activity is involved. Here "With Tanker" stands for supply in bulk. In Service Tax sector, there is no such pre-condition/pre-requisite for availing input service credit. Only nexus is to be established as already advised above.

However, as expressed by Sh.Mukund Thakkar, Sir and Sh.Himansu Sha Ji, if the supplier is ready to rectify the bill with the words, " For Industrial/Construction purpose/use", there is no harm to this addition on the bill. The Department would not object in both ways i.e. with these remarks or without these remarks on the invoice.

The purpose is that the assessee should remain tension-free. Otherwise legally there is no problem.

[MUKUND THAKKAR]

Respected kasturi sethiji..

Agree with your view. no doubt when your valuable word is making things easy..

please keep continue shower of your knowledge ..

[KASTURI SETHI]

Sh.Mukund Thakkar, Sir

Thanks. When you agree with me on some issue, it matters a lot for me. It has a great value. It is a moral booster for me.

[Ganeshan Kalyani]

With due respect to all the experts, i would like to mention that in one of the case, the auditor relied upon the description on the invoice and did not accepted the actual background of the case. It was difficult to explain the intention which does not have any documentary evidence. Thus description on invoice play a vital role. Thanks.