Naveen Chand Khulve (CA) (1521 Points)
01 December 2008It is mandatory to take credit of Cenvat each and every time? Comment as an Auditor.
Further what is the differnce between Cenvat and Modvat?
Kshitij
(PCC Student)
(125 Points)
Replied 01 December 2008
If you have some CENVAT credit available in your books from previous purchases you have made, you can take their credit.
It is not compulsory, if you like your organizations to have more expenses and less profit, then you can preferable go for such an option.
CENVAT credit is just a facility provided to those people who have a vaild Excise Regn. No. & are dealing in its related transactions, its not something hard & fast.
Before total imposition of VAT (which later on took place 2005 onwards) in our country excise payment & the method of taking its credit was known as MODVAT, i.e. Modified Version of VAT.
Anoop Garg
(FCA)
(120 Points)
Replied 14 January 2009
It is Not mandatory to take credit of Cenvat ,it is to abdudged according to planning.
For Capital Items- This is management Decn.They have forego cenvat if they want higher depreciation due absorption of excise duty element in cost of cap asset.
For Revanue Items-This depends upon tax planning,if you are exporter some time it is better to avail DEPB,Expo Incentives etc then one has to forego Cenvat.
Shudhanshu Agrawal
(Business)
(2570 Points)
Replied 14 January 2009
I dont think if somebody is having cenvat credit available then in such a case he will not take the benefit of it......it will be like donating the money
CAclubindia
