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Availment of Credit based on computer generated invoice Pre and Post Budget 2015-16

Availment of Credit based on computer generated invoice: Pre and Post Budget 2015-16 - Service Tax - By: - ashish chaudhary - Dated:- 9-7-2015 - Availment of credit based on unsigned invoice or printed signature on computers generated invoice has at times been an area of audit objections by departmental official during the audit, verification, investigation. The law was silent on the issuance of computerized invoice and taking of credit based on computerized invoice. Finance Act 2015 has provide .....

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which credit can be availed of tax paid on inputs and input services. An extract of the said rule has been produced below: Rule 9 of Cenvat Credit Rules, 2004, The CENVAT credit shall be taken by the manufacturer or the provider of output service or input service distributor, as the case may be, on the basis of any of the following documents, namely :- (a)… (f)an invoice, a bill or challan issued by a provider of input service on or after the 10th day of September, 2004. (g)an invoice, bi .....

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voice issued by service provider would be sufficient even though not issued in terms of Rule 4A of Service Tax Rules, 1994. However, there may be another interpretation also as per which Rule 4A was inserted w.e.f. 10.9.2004 and by making reference of the said date in the above rule, the legislature had intended that invoice would invariably be issued under that rule and may be due to which no explicit reference of Rule 4A has been made. Reference of CCR and IT Act It would be relevant to discus .....

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n number of the person issuing the invoice, as the case may be,] name and address of the factory or warehouse or premises of first or second stage dealers or [provider of output service], and the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, is satisfied that the goods or services covered by the said document have been received and accounted for in the books of the account of the receiver, he may allow the CENVAT credit.] Hence, the sa .....

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thing contained in such law, such requirement shall be deemed to have been satisfied, if such information or matter is authenticated by means of electronic signature affixed in such manner as may be prescribed by the Central Government The above section renders an overriding effect of the IT Act, 2000 over all other laws. Furthermore, explanation to the above section states For the purposes of this section, signed , with its grammatical variations and cognate expressions, shall, with reference t .....

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are summarized as below: Dewshree Network Pvt. Ltd. v/s Commissioner of Central Excise & Service Tax, Surat, (2013 (12) TMI 498 - CESTAT AHMEDABAD)STAY Matter (not final judgment): held that CENVAT credit availed on the basis of computer generated invoices issued by service provider is prima facie ineligible as such practice is not in accordance with the Service Tax Rules read with the provisions of Rule 9 of the CENVAT Credit Rule, 2004. CREATIVE ARCHITECTS & INTERIORS (Commissioner App .....

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stating that in such a case if assessee files declaration as contemplated under Cenvat Credit Rules, 2002, credit is permissible - Since procedural lapse is not a grave mistake and in the light of Board s circular, credit admissible - Rule 9 of Cenvat Credit Rules, 2004. On perusal of above decisions, it is clear that there is no consensus among judiciary as to availment of credit based on computer generated invoice. As per settled principle of law, substantive benefit cannot be denied on accoun .....

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of a digital signature. Preservation of records authenticated by digital signature (Rule 5(4) of Service Tax Rules): Records under this rule may be preserved in electronic form and every page of the record so preserved shall be authenticated by means of a digital signature. Further, it has been provided that Board may, by notification, specify the conditions, safeguards and procedure to be followed by an assessee issuing digitally signed invoice and/or preserving digitally signed records. Notif .....

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ommissioner (AC/DC) at least fifteen days in advance: name, e-mail id, office address and designation of the person authorised to use the digital signature certificate; name of the Certifying Authority; date of issue of digital certificate and validity of the digital signature with a copy of the certificate issued by the Certifying Authority along with the complete address of the said Authority: Every change to be intimated within 15 days of such change Assessee already using digital signature s .....

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