TMI BlogBanks are entitled to avail CENVAT credit on service tax paid to Deposit Insurance Credit Guarantee...Banks are entitled to avail CENVAT credit on service tax paid to Deposit Insurance Credit Guarantee Corporation (DICGC) for insurance services, commission/brokerage paid to brokers for underwriting government securities or making investments to maintain Statutory Liquid Ratio under Banking Regulation Act, 1949. These activities are essential for banking operations and qualify as input services under CENVAT Credit Rules, 2004. The Larger Bench decisions of CESTAT in South Indian Bank and Bank of America cases have upheld this position, which has also been confirmed by High Courts. Penalty cannot be imposed if service tax with interest is paid before issuance of show cause notice, as per Section 73(3) of Finance Act, 1994. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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