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TMI BlogService tax credit on making the new partition and cabins in existing factoryX X X X Extracts X X X X X X X X Extracts X X X X ..... Dear Sir, We have registered with excise and service tax as manufacturer. In our factory we made some modification in plant layout so we making some additional partition and cabina for staff members and installation the machine as per new plan. For this purpose we gove contract for this work and he give invoice with service tax as a work contract service. My question is can we take the credit of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this service tax ? Regards Swapneswar - Reply By Rajagopalan Ranganathan - The Reply = Sir, Rule 2 (k) of Cenvat Credit Rules,2004 input service means any service, - (i) used by a provider of output service for providing an output service; or (ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal products upto the place of removal, and includes services used in relation to modernisation, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, advertisement or sales promotion, market research, storage upto the place of removal, procurement of inputs, accounting, auditing, financing, recruitment and quality cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rol, coaching and training, computer networking, credit rating, share registry, security, business exhibition, legal services, inward transportation of inputs or capital goods and outward transportation upto the place of removal. In my opinion the service received by you will be of modernization/renovation of your factory premises. Hence you are eligible to avail the credit of service tax paid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on such service. - Reply By ashish chaudhary - The Reply = You must be able to establish that the expenditure have been incurred for modernisation/renovation to take the credit. Credit for set up may not be allowed after specific omission of word set up from the definition of input service. If capitalised in the books of account, prima facie, department may take stand that it is for set up. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Proper clauses in agreement with contractor and invoice pattern could be basis for ascertainment whether same is for set-up or modernisation/renovation. - Reply By YAGAY AND SUN - The Reply = Nature of accounting treatment would decided the future of availment of CENVAT credit on this transaction. - Reply By Mahir S - The Reply = Sir, the work carried out dos not appear to fall either under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... renovation or modernization or setting up. It is modification , as you have rightly said in your query. Such modification has no relevance with manufacturing activity, hence it is advisable not to avail such input credit. - Service tax credit on making the new partition and cabins in existing factory - Query Started By: - Swapneswar muduli Dated:- 6-10-2015 Central Excise - Got 4 Replies - Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntral Excise - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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