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Ajay Sharma (Lawyer)     27 July 2009


A client has not availed abatement of 75% available to GTA service and has paid service tax on whole amount received, by mistake. He has also taken cenvat credit on the whole amount of service tax paid.

Department is asking for reversal of excess amount of credit taken. What can be done? Plz reply asap.


 1 Replies

K.Prakash Babu (Advocate)     08 August 2009

An assessee can not take cenvat credit of service tax excess paid on 75% value of freight charges ignoring the abatement factor.  Department is right in asking to reverse the same immediately.  Please ensure the following:

1. The excess payment of service tax is within a period of 12 months.

2. If the payment is within a period of 12 months, a refund claim of the excess paid amount can be lodged immediately.

3. In this case, unjust enrichment do get attracted as the amount paid is by the service receiver.

Hope above gives you clarity.


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