Inputs for cement

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 February 2012 a cement company is using pharmaceutical wastage instead of coal for burning.

My doubt is " can we consider that pharmaceutical waste as input ?"

thanks in advance

Querist : Anonymous

Querist : Anonymous (Querist)

09 February 2012 " can we consider coal as input ( for producing cement ) for costing purpose ?"

kartik_somu

kartik_somu (Expert)
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09 February 2012 yes. if it is used in the manufacture of final product

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Querist : Anonymous

Querist : Anonymous (Querist)

09 February 2012 then can we take cenvat credit for coal?

&

for costing purpose also is it an input ?

Querist : Anonymous

Querist : Anonymous (Querist)

09 February 2012 here pharmaceutical waste means hazardous waste

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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01 August 2024 Let's break down the questions regarding the use of pharmaceutical waste and coal in the production of cement and their treatment for CENVAT credit and costing purposes.

### 1. **Pharmaceutical Waste as Input:**

**Can pharmaceutical waste be considered an input?**

- **Regulatory Perspective:** In general, hazardous waste, including pharmaceutical waste, is not typically considered an "input" in the context of VAT/CENVAT credit. The input credit system primarily deals with goods and services used in the manufacture of final products or services, which are sold or provided for consideration.

- **CENVAT Credit:** Under CENVAT Credit Rules, the term "input" typically refers to raw materials and other goods used directly or indirectly in the production process. Hazardous waste such as pharmaceutical waste would generally not qualify as an "input" for CENVAT credit purposes because it is not used in the traditional sense of raw material but rather as a substitute or additive.

### 2. **Coal as Input:**

**Can coal be considered as an input for producing cement and can CENVAT credit be claimed for coal?**

- **Input Definition:** Coal used as a fuel in the manufacturing process of cement can be considered as an input for costing purposes. It is used directly in the production process.

- **CENVAT Credit:** As per CENVAT Credit Rules, coal used as fuel for manufacturing processes can indeed qualify for CENVAT credit. This means that you can claim CENVAT credit on the service tax paid for coal, as it is used in the production of the final product (cement).

**For costing purposes:**

- **Input in Costing:** Yes, coal is a direct input in the production process of cement and should be included in the costing of cement. It is a key raw material used in the production process.

### **Summary:**

1. **Pharmaceutical Waste:**
- **Not Considered as Input:** Pharmaceutical waste, particularly hazardous waste, is not typically considered an input for CENVAT credit purposes or for standard costing in the production of cement.

2. **Coal:**
- **Considered as Input:** Coal is considered an input for the production of cement.
- **CENVAT Credit:** You can claim CENVAT credit on the service tax paid for coal as it is used in the production process.
- **Costing:** Coal should be included in the costing of cement production.

### **Additional Notes:**

- **Regulations and Notifications:** Always check the latest regulations, notifications, or any amendments that might impact the treatment of inputs, especially for hazardous waste or other non-standard materials.
- **Consult a Professional:** Given the complexity of tax regulations and costing standards, it may be beneficial to consult with a tax professional or accountant familiar with the specific regulations applicable to your industry and jurisdiction.