CENVAT credit on capital goods.

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

20 October 2010 some capital goods purchased on 01-07-2007. The excise duty paid thereon was Rs. 200000.00
As per Rule 4(2) of CENVAT Credit Rules, 2004, CENVAT Credit on capital goods may be taken in the financial year in which capital goods received to the extent 50% of excise duty paid. The balance 50% can be taken in any of subsequent Financial Years in which goods are in possession.

> So, Rs. 100000.00 can be taken in the month of july-2007 (i.e. Financial year 2007-08)

> let these capital goods scrapped on 30-06-2010.

Q: in which Financial year and in which month, balance amoun of the CENVAT credit may be taken?

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
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20 October 2010 In case of consumables like spare parts , components, moulds and dies , refractories and grinding wheels the balance credit can be availed in subsequent year , even if they are not in possession.

CA Punit

CA Punit (Expert)
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20 October 2010 balance 50% credit can be taken in the next f.y. ie. 08-09
if capital goods are sold as scrap..duty on the sale value will have to paid.

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Kishanlal Paliwal

Kishanlal Paliwal (Expert)
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20 October 2010 Please take care, beside charging excise duty, levy of TCS also applicable on sale of scrap. The current effective rate is 1.3%

The balance CENVAT credit may be taken on any day during the next financial year, it may be 1st April also.

Regards
K.L.Paliwal

Rahul Vora

Rahul Vora (Expert)
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20 October 2010 Agreed with Kishanlal. You should have taken the balance credit on 1st April, 2008.

Querist : Anonymous

Querist : Anonymous (Querist)

20 October 2010 thanks for replying

for exams point of view, in which month we should take credit?

CA Punit

CA Punit (Expert)
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21 October 2010 credit can be taken at the earliest opportunity available i.e. 1st of April 08

CA Nilesh P. Kanodia

CA Nilesh P. Kanodia (Expert)
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26 March 2014 i Have a small query?
at the time of purchase of capital goods excise was not applicable so CENVAT was not taken.

Where as at the time of sale of Capital goods Excise was applicable so my questions are:

1) Does the seller require to issue excise invoice?

2)if he has not taken CENVAT credit then how he will apply 2.5% per quarter or part thereof?

Please Reply me

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