HBJ Mumbai (Director) (125 Points)
13 February 2013If we want to use some common materials, for which cenvat credit already taken, to manufacture goods to be cleared under notification 10/97, what is the rule? If we have to reverse 5% value of finished goods as duty credit then it is very expensive as raw material percentage in total value is only about 10%. Is there any other provision in such cases?
Rakshit
(practising)
(338 Points)
Replied 14 February 2013
With effect from 01.4.2012, the rate is 6% not 5% as refereed by you. Credit on common inputs and input services used in the manufacture of exempted goods or providing exempted services is very delicate if not handled properly. Credit on such common inputs/input services of even a single ruppee in the cenvat account may cause havoc. Yes, there is a procedure prescribed under rule 6(3) read with rule 6(3A) of the Cenvat Credit Rules,2004.
Regards
RAKSHIT
09810525780
GSTR 9 and 9C for FY 23-24 as amended by Notification 12/2024 dated 10th July 2024(with recording)
CAclubindia
