If Assessee has to pay Service Tax even after introduction of GST, their Right to avail ITC cannot be denied: CESTAT If Assessee has to pay Service Tax even after introduction of GST, their Right to avail ITC cannot be denied: CESTAT Chartered Accountant CA ICAI Chartered Accountants CA ICAI CAinINDIA ICAI Announcements Accounting Standards CA News ICAI Students ICAI Members Case Laws CPT IPCC Final ICAI Course CA Course ICAI Forum CA Question Papers ICAI Study Material

« GST - Goods and Services Tax »

Open DEMAT Account in 24 hrs
State government extends due date for filing GST returns for November
GSTN Introduces the e-Invoice Verifier App: All You Need to Know
Income tax return filing: What is ITR 1 Sahaj form? Check eligibility and steps to file online
GST council may consider setting up tribunal for indirect tax litigation
GST Council may lower tax on health insurance
GST Annual Return: CBIC amends GSTR-9 to Allow IRC Claims and Amendment of Invoices till 30th Nov
GST (Tax) E-invoice Must For Businesses With Over 5 Crore Annual Turnove
GST Portal Releases Module-wise New Functionalities deployed on the Portal for Taxpayers
GST on betting and gambling: Tax structure and liabilities in case of default
Budget to reset tax laws to decriminalise sections in I-T, GST: Finance Ministry
In relief to tenants, AAR allows tax credit on GST paid on upfront lease premium


« Know Top 10 changes in GST Law effective from January 1st,...	GST officers can directly initiate recovery action against... »
If Assessee has to pay Service Tax even after introduction of GST, their Right to avail ITC cannot be denied: CESTAT

December, 24th 2021
The Chennai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that if assessee has to pay service tax even after introduction of GST, their right to avail ITC cannot be denied. The appellants, M/s.Circor Flow Technologies India Private Ltd. are engaged in the manufacture of valves and were holding registration under Central Excise and Service Tax Commissionerates during the pre-GST regime. They entered into transactions during January 2017 to June 2017 involving import of software for which service tax was liable to be paid under reverse charge mechanism. They paid the service tax belatedly in March 2019. The said tax was for the services received by them from the foreign service provider for the period January 2017 to June 2017 and the tax was paid under reverse charge mechanism. In terms of Cenvat Credit Rules,2004 as it stood during the relevant period, the appellants were eligible to avail credit of the service tax paid by them. After introduction of GST with effect from 1.7.2017, as appellants could not avail cenvat credit, they filed an application for refund of the amount of which they are eligible for credit. The refund claim was rejected by the adjudicating authority stating that the tax has been voluntarily paid and that no credit is eligible in the GST regime. On appeal filed before the Commissioner (Appeals), the said view was upheld. The coram of Judicial Member Sulekha Beevi C.S. held that the liability, if any, under the erstwhile law of Finance Act, 1994 to pay service tax would continue even after the introduction of GST. Conversely, the right accrued under the said Act in the nature of credit available under CCR 2004 also is protected. If the assessee has to pay service tax even after the introduction of GST, their right to avail the credit on the same cannot be denied. The court noted that there was no allegation that the credit is not eligible to the appellant. It was merely stated that tax has been paid voluntarily and therefore credit is not available under the GST regime. Though credit is not available as Input Tax Credit under GST law, the credit under the erstwhile Cenvat Credit Rules is eligible to the appellant. Such credit has to be processed under Section 142 (3) of GST Act, 2017 and refunded in cash to the assessee.