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What are the provisions
for availment of CENVAT credit? |
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A provider of taxable service shall be
allowed to take credit of : |
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i) |
The duty of excise
specified in the First and Second Schedule to the Excise
Tariff Act, leviable under the Excise Act;; |
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ii) |
The Additional duty of excise leviable
under Section 3 of the Additional Duties of Excise
(Textile and Textile Articles) Act, 1978; |
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iii) |
The Additional duty of excise leviable
under Section 3 of the Additional Duties of Excise
(Goods of Special Importance) Act, 1957; |
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iv) |
The NCCD leviable under Section 136 of
the Finance Act, 2001; |
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v) |
The Education Cess on excisable goods
leviable under Section 91 read with Section 95 of the
Finance (No.2) Act, 2004. |
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vi) |
The Additional duty leviable under
Section 3 of the Customs Tariff Act; |
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vii) |
The additional duty of excise leviable
under Section 157of the Finance Act, 2003’ |
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viii) |
The Service Tax leviable under Section 66
of the Finance Act; and |
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ix) |
The Education Cess on taxable services
leviable under Section 91 read with Section 95 of the
Finance (No.2) Act, 2004. |
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a) |
any input or capital goods received in the premises of
the provider of output service on or after 10th
September, 2004; and |
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b) |
any input service received by the provider of output
services on or after 10th September, 2004.
CENVAT
credit shall be allowed after payment is made of the
value of taxable services and the service tax paid or
payable. |
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It is important to note that input
service means any service used by a provider of taxable
service for providing an output service, or used by the
manufacturer, whether directly or indirectly, in or in
relation to manufacture of final products and clearances
of final products from the place of removal and includes
services used in relation to setting up, modernization,
renovation or repairs of a factory, premises of a
provider of output service or an office relating to such
factory or premises, advertisement or sales promotions,
market research, storage upto the place of removal,
procurement of inputs, activities relating to business
such as accounting, auditing, financing, recruitment and
quality control, coaching and training, computer
networking, credit rating, share registry and security,
inward transportation of inputs or capital goods and
outward transportation upto the place of removal. [Rule
2 (l) of CENVAT Credit Rules, 2004 refers]. |
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What are the provisions for
utilization of CENVAT credit? |
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The CENVAT credit may
be utilized for payment of service tax on any output
service subject to restrictions contained in the CENVAT
Credit Rules.
Provided that while
paying service tax, the CENVAT credit shall be utilized
ony to the extent such credit is available on the last
day of the month or quarter, as the case may be, for
payment of Service Tax relating to that month or
quarter, as the case may be.
In case the assessee
provides both taxable and non-taxable services and opts
not to maintain separate sets of accounts in respect of
both the kinds of services then he may utilize CENVAT
Credit only to the extent of 20% of the amount of
Service Tax payable on taxable out put service and the
balance 80% of the Service Tax so payable shall be paid
by him in cash through TR-6 challan. |
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Whether
any documents are prescribed on which CENVAT credit can
be availed? |
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In case of inputs or
capital goods, invoice issued by the manufacturer,
importer, first and second stage dealers, bill of entry,
certificate issued by the Appraiser of Customs in case
of goods imported through a Foreign Post Office.
In case of input
service, invoice/bill/Challan issued on or after
10.09.04 by the service provider or the input service
distributor or Challan issued by the person liable to
pay tax under Rule-2(1) (d) (iii), 2 (1) (d) (iv) and
2(1) (d) (v) of the Service Tax Rules, 1994. |
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Who is an input service distributor? |
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Input Service
Distributor means an office of the manufacturer or
producer of final products or provider of output
service, which receives invoices issued under Rule 4A of
the Service Tax Rules, 1994 towards purchases of input
services and issues invoice, bill or, as the case may
be, challan for the purposes of distributing the credit
of service tax paid on the said input services to such
manufacturer or producer or provider, as the case may
be. |
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