Dear All,
What are the possible reasons/circumstances for loss of Cenvat Credit availment for a manufacturing concern? How can we ascertain during an audit that there is no loss of Cenvat credit to the client?
Regards,
Rachana.
3 Replies
Swati
(CA)
(76 Points)
Replied 04 December 2009
Check if the client is taking credit of the service tax/excise duty on the input services/inputs/capital goods that the client is receiving.
Further, you can also see if there is accumulation of credit at his end. If yes, suggest methods of utilising it.
CA Amit Kanani
(Practicing CA)
(338 Points)
Replied 19 December 2009
Verify that all Input /Capital Goods/Input servies on which duty/Service tax has paid is properly accounted and Cenvat availd properly in respect of duty/tax paid as per Cenvat Credit Rules,2004.
Reetika Goel
(Qualified Chartered Accountant)
(565 Points)
Replied 20 December 2009
For checking CENVAT CREDIT LOSS,
Just check all the input/Capital Goods/Input Service Invoices & check the corresponding credit in the RG23A Part-II & RG 23C Part II
If you find any discrepancy in both credits, look out for reasons:
Reasons can be (For Example): 1) Non-Receipt of goods in factory
2) Goods not connected in manufacture of final goods
3) Manufacturer is availing some Exemption Notification in pursuance of which he is disentitled to book CENVAT Credit.
If none of the reasons persist, then make a note of same and report to the management.
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