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How to adjust custom duty input credit towards st payable

chandrasekhar.V (Manager-Accounts) (56 Points)

23 November 2012

Hi,

i am wokring as a Accounts Manager in Construction company. we imported Elevators from japan for selling apartments.

At the time of importing materials, we paid (BCD)Basic customs duty 7.5% on basic value of material, (CD)Countervailing duty 12.00% on Basic value + BCD and Additional duty 4% on Basic Value + BCD + CVD.

how to adjust the above custom duty input credit towards Service tax Payable.

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6 Replies

CA Ruben Balooni (Professionalism ™) (1324 Points)
Replied 23 November 2012

You can book the cenvat credit of CVD 3(1) paid on Assessable Value+BCD only and utilise it towards the payment of service tax liability. Since you are a service provider you are not eligible to book the credit of CVD 3(5) as per Rule 3(1) of Cenvat Credit Rules, 2004.

- Ruben Balooni

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satya (Executive Excise) (1839 Points)
Replied 24 November 2012

Dear Ruben ji,

I have not understood that , how he is eligible Customs duties towards payment of ST?

give full rule details please.

CA Ruben Balooni (Professionalism ™) (1324 Points)
Replied 24 November 2012

Originally posted by : sathya
	Dear Ruben ji, I have not understood that , how he is eligible Customs duties towards payment of ST? give full rule details please.

Rule 3(1) of Cenvat Credit Rules,2004 is as follows :

(1) A manufacturer or producer of final products or a provider of taxable service shall be allowed to take credit (hereinafter referred to as the CENVAT credit) of -

(i) the duty of excise specified in the First Schedule to the Excise Tariff Act, leviable under the Excise Act;

(ii) the duty of excise specified in the Second Schedule to the Excise Tariff Act, leviable under the Excise Act;

(iii) the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act,1978 ( 40 of 1978);

(iv) the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 ( 58 of 1957);

(v) the National Calamity Contingent duty leviable under section 136 of the Finance Act, 2001 (14 of 2001);

(vi) the Education Cess on excisable goods leviable under section 91 read with section 93 of the Finance (No.2) Act, 2004 (23 of 2004);

(via) the Secondary and Higher Education Cess on excisable goods leviable under section 136 read with section 138 of the Finance Act, 2007 (22 of 2007);
[ Substituted vide Notification No. 27/2007-Central Excise (N.T.) dated 12-05-2007 ]

(vii) the additional duty leviable under section 3 of the Customs Tariff Act, equivalent to the duty of excise specified under clauses (i), (ii), (iii), (iv), (v) (vi) and (via); [Substituted vide Notification No. 10/2007-Central Excise (N.T.) dated 01-03-2007 ]

(viia) the additional duty leviable under sub-section (5) of section 3 of the Customs Tariff Act, [OMITTED- as substituted by clause 72 of the Finance Bill, 2005, the clause which has, by virtue of the declaration made in the said Finance Bill under the Provisional Collection of Taxes Act, 1931 (16 of 1931), the force of law ]:

(In clause (viia), portion beginning with the words and figures "as substituted by clause 72" and ending with the words "the force of law" has been omitted vide Notification No. 22/2005 -Central Excise (N.T.), dated 13/05/2005)

Provided that a provider of taxable service shall not be eligible to take credit of such additional duty;

(Clause (viia) has been inserted vide Notification No. 13/2005 - Central Excise (N.T.), dated 01/03/2005)

(viii) the additional duty of excise leviable under section 157 of the Finance Act, 2003 (32 of 2003);

(ix) the service tax leviable under section 66 of the Finance Act; and

(x) the Education Cess on taxable services leviable under section 91 read with section 95 of the Finance (No.2) Act, 2004 (23 of 2004),

“(xa) the Secondary and Higher Education Cess on taxable services leviable under section 136 read with section 140 of the Finance Act, 2007 (22 of 2007); and

(xi) the additional duty of excise leviable under section 85 of Finance Act, 2005 (18 of 2005 )

(In clause (xi), the words and figures "section 85 of Finance Act, 2005 (18 of 2005 )" has been substituted vide Notification No. 22/2005 -Central Excise (N.T.), dated 13/05/2005)

(Clause (xi) has been inserted vide Notification No. 13/2005 - Central Excise (N.T.), dated 01/03/2005)

paid on-

(i) any input or capital goods received in the factory of manufacture of final product or premises of the provider of output service on or after the 10th day of September, 2004; and

(ii) any input service received by the manufacturer of final product or by the provider of output services on or after the 10th day of September, 2004,

including the said duties, or tax, or cess paid on any input or input service, as the case may be, used in the manufacture of intermediate products, by a job-worker availing the benefit of exemption specified in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 214/86- Central Excise, dated the 25th March, 1986, published in the Gazette of India vide number G.S.R. 547 (E), dated the 25th March, 1986, and received by the manufacturer for use in, or in relation to, the manufacture of final product, on or after the 10th day of September, 2004.

Source -> https://www.cbec.gov.in/excise/new-cenvat-rules.htm

- Ruben Balooni

vinayak kadam (B.Com) (22 Points)
Replied 23 November 2014

Hi, i am wokring as a Accounts Manager in packaging company. we purchased imported machinary We can avile CVD + edu cess S & sh cess cenvat credit

ANAND GUPTA (MANAGER) (24 Points)
Replied 10 March 2017

My question is that which item can be claimed against excise duty payable (Basic custom duty(7.5%) and CVD (12.5%) and Additional Custom Duty (4%) on import transaction).

Can BCD (basic custom duty can be claimed with excise duty)

please show seperately item wise.

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Madan Kumar (Student CA CPT ) (22 Points)
Replied 30 March 2017

Hi, i am working as a Accountant, we got custom audit from the department and they noticed that, we have not used the import of good for manufactuering purpose, that good we kept aside from past 3 years, so that the auditor told to us to payment Custom duty with interest.

My question is we need to pay or not? Because ours is 100% EOU (Export oriental Unit) company. So we planed that Instead of paying custom duty to governamnet we can adjust the same amount with the Service tax refund (Form-A).

Need suggestion.