Ajay Raghatate (Sr Executive (Excise & Accounts)) (736 Points)
13 February 2009What is the procedure to take the cenvat credit of capital goods other than chapter Heading No 82, 84, 85 & 90, kindly .explain me
Rajesh Kumar
(Advocate- Tax)
(7806 Points)
Replied 13 February 2009
Credit on Capital goods, which are not defined as capital goods in Cenvat Credit Rules, is available as input. In CCE v. Telco [2003 (158) ELT 130 (SC)], supreme court held that trucks, lifting tackles, trolleys, conveyors, measuring instruments etc. are inputs and eligible for credit as inputs. Same view in Union carbide by larger bench of tribunal [1996 (86) ELT 613]. The legal postition is settled.
Thus, when the thing is covered under the definition of capital goods, take credit as capital goods (50% in the current financial year, and 50% in next.). If the thing is not covered in the definition of capital goods, take full credit as input. The accounting definition of capital goods and input are irrelevant for the purpose.
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