service tax credit

Querist : Anonymous (Querist) 15 October 2010 This query is : Resolved
i work in a manufacturing company. we take many servies on which we pay service tax. but no credit of service tax is being taken by my company. whether service tax credit can be taken?? no output service is being provided by my company but only manufactured items are being sold. kindly mention the provision also which allows/disallows credit.

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soumitra basu (Expert) 17 October 2010
No you cannot avail any input credit for service tax.

R.Ramachandran (Expert) 17 October 2010
Dear Mr. Soumitra,
I am unable to understand how you have straight away said that cenvat credit of service tax paid cannot be taken, without even knowing what are the services availed by the manufacturing unit. For instance, if the manufacturing unit had paid the service tax on GTA service on reverse charge method what will happen to that can they no take credit of that. If the manufacturing unit had taken any legal services; or services for setting up of factory; infrastructure etc., cannot they take the credit?

Madhava Law Office (Expert) 19 October 2010
You can take CENVAT Credit only if such services are used for manufacturing goods. Such use of service may be direct or indirect.

Devajyoti Barman (Expert) 24 October 2010
I agree.

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