Tuesday, September 4, 2012

"Input Service" excludes some services


Cenvat credit on certain input services cannot be availed for those services specifically excluded from definition of service tax:-

Input services means any service......., but Excludes

o   Services provided by  Renting of Motor Vehicle (where motor vehicle are not capital goods)

o   Services of
§  General Insurance Business
§  Servicing
§  Repair & Maintenance
In so far they relate to motor vehicle (which is not capital goods)

But these will not be excluded when used by:
·         Manufacturer of motor vehicle for motor vehicle manufactured by such person or
·         Insurance co. In respect of motor vehicle insured or reinsured by such person

o   Provided to
§   Outdoor catering
§  Beauty treatment
§  Health services
§  Cosmetics & plastic surgery
§  Membership of club
§  Health & fitness centre
§  Life insurance
§  Health insurance and travel benefits extended to employees on vacation

When such services are used primarily for personal use or consumption of any employee

o   Service portion in execution of
§  Works contract
§  Construction services
§  Services U/S 66E (b)
·         In so far they used for
Ø  Construction
Ø  Execution of works contract
Of a building or a civil structure or part thereof

Ø  Laying of foundation
Ø  Making of structures

For support of capital goods.

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