India Supreme Court Clarifies VAT Credit Rules for Mobile Service Providers

The Indian Supreme Court Nov. 20 issued a judgment regarding the central VAT (CENVAT) credit rules for mobile service providers (MSPs). The taxpayers, a group of MSPs, sought to claim CENVAT credits to offset excise duties attributable to mobile towers and prefabricated buildings (PFBs). On appeal, the Supreme Court ruled that the taxpayers were: 1) entitled to claim the CENVAT credit to offset excise duties because the mobile towers and PFBs were movable property that are considered capital goods and inputs under the relevant provisions of the CENVAT Rules; and 2) therefore entitled to use the CENVAT credit to pay ...