Cenvat credit
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
08 August 2011
dear members,
one of our audit client is dealing in steel industry. They purchase raw material through brokers. So in each purchase they receive 2 invoices.
1 from supplier and the 2nd from broker for the same goods purchased.
The broker adds300 per tn as his commission and supply the goods. Also in the brokers bill only the amt of VAT is reflected. So for cenvat credit our client record amount from suppliers invoice and VAT is being recorded from brokers invoice.
It is to be noted that the goods are delivered directly to the our clients place and no delivery is being taken by broker.
So in this case, is the accounting is proper??
one of our audit client is dealing in steel industry. They purchase raw material through brokers. So in each purchase they receive 2 invoices.
1 from supplier and the 2nd from broker for the same goods purchased.
The broker adds300 per tn as his commission and supply the goods. Also in the brokers bill only the amt of VAT is reflected. So for cenvat credit our client record amount from suppliers invoice and VAT is being recorded from brokers invoice.
It is to be noted that the goods are delivered directly to the our clients place and no delivery is being taken by broker.
So in this case, is the accounting is proper??
U S Sharma
(Expert)
08 August 2011
NO
1) either the Excise invoice should carry the "buyer" name as your client and excise code(regn) no of your buyer should be reflected in the invoice, vat etc should be discharged by the principal manufacturer only, and the broker would issue debit note only for his commission, no vat should be discharged by broker,
2) broker has to get registered as dealer under excise and issue cenvatable invoice to your client, after charging additional vat etc.
1) either the Excise invoice should carry the "buyer" name as your client and excise code(regn) no of your buyer should be reflected in the invoice, vat etc should be discharged by the principal manufacturer only, and the broker would issue debit note only for his commission, no vat should be discharged by broker,
2) broker has to get registered as dealer under excise and issue cenvatable invoice to your client, after charging additional vat etc.
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