benefit
This query is : Resolved
30 June 2010
Dear Sir,
A Manufactur is Regesterd under SalesTax,Vat,ServiceTax.he Has purchased a machinery on which he has paid Excise Duty asy 209000.00 and CST with C Form 49000.00.He is not regestered under Excise.Can he Take Setoff of Excise Duty against Service Tax & What treatment should be given to CST with C Form.I Have Ledger Ac:
Machinery 2090000.00 Dr ( Fix Aset)
Excise Duty 209000.00Dr (Current Aset)
CST C Form 49000.00 Dr (unknown)
Party Cr 2348000 cr (Creditors)
is the entry right
Regards
A Manufactur is Regesterd under SalesTax,Vat,ServiceTax.he Has purchased a machinery on which he has paid Excise Duty asy 209000.00 and CST with C Form 49000.00.He is not regestered under Excise.Can he Take Setoff of Excise Duty against Service Tax & What treatment should be given to CST with C Form.I Have Ledger Ac:
Machinery 2090000.00 Dr ( Fix Aset)
Excise Duty 209000.00Dr (Current Aset)
CST C Form 49000.00 Dr (unknown)
Party Cr 2348000 cr (Creditors)
is the entry right
Regards
Shyam Lal Naik
(Expert)
30 June 2010
1. Credit of Central Sales Tax not available. Amount of Rs. 49000/- shall be added to the cost of machinery(Fixed Asset).
2. Cenvat Credit of Excise duty is available, if the machinery is used for providing taxable output service. Further, the machinery should satisfy the definition of capital goods. If the twin conditions are satisfied, you can take credit to the extent of 50% in the year of purchase and the balance in subsequent years. Else, the amount of excise duty shall also be capitalised.
2. Cenvat Credit of Excise duty is available, if the machinery is used for providing taxable output service. Further, the machinery should satisfy the definition of capital goods. If the twin conditions are satisfied, you can take credit to the extent of 50% in the year of purchase and the balance in subsequent years. Else, the amount of excise duty shall also be capitalised.
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