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Cenvat credit

EXICSE (Legacy) 494 views 1 replies

Dattatri

Tax consultant

121 Points Posted on 31 December 2015

Does a dealer registered under Central Excise as "DEALER" need to maintain both CENVAT Credit Availed and Excise Duty collected account (ledger Account) for each bill in his books and at the end of each month transfer both debit and credits to CENVAT Credit account and show the closing balance in the CENVAT Credit account? As a dealer, he is only passing the CENVAT credit for each input and for the items available in the stock, the cenvat credit balance will remain in the account. Also i would like to know, is it necessary to show the un utilized portion in the books and in balance sheet as current asset?

Replies (1)

Madhukar N Hiregange

Chartered Accountant

39039 Points Posted on 01 January 2016

A regd. dealer under central excise is not eligible for availing the credit. As rightly observed he is just passing on the duty chagred by the manufacturer/ supplier to the customer. H eis required to pass on the credit proportinately and consignment wise record is tobe maintained. No accounting entries are tobe passed as there is no question of availing the credit. Question of unutilised portion also not relevant as credit itself is not to be aviled.