Cenvat credit

This query is : Resolved

P.A. FRANCIS (Querist)
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19 February 2012 4 years back i have purchased capital goods taken credit of 16% Cenvat duty, now i want to resale to some others. At present Excise duty is 10%, so now what % of duty to be charged to my customer

CA. Rajesh P. Ahir

CA. Rajesh P. Ahir (Expert)
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19 February 2012 it will be 16%.

or you can sell it as scrap and pay duty accordingly (applicable to scrap).

CMA Loganathan Sekar

CMA Loganathan Sekar (Expert)
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20 February 2012 same duty...

CA Nikhil Jhanwar

CA Nikhil Jhanwar (Expert)
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20 February 2012 There are two aspects:

1. If capital goods are removed as such, then whole 16% duty which was taken as credit will be reversed.

2. If capital goods are removed after being used then Credit required to be reversed is:

Credit taken - 2.5% reduction for each quarter on SLM basis ( In your case to be reduced for 40%)

Maninder Jain

Maninder Jain (Expert)
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20 February 2012 If capital goods are removed after being put to use- it is not as such removal. The duty will be applicable on transaction value at applicable rate on such goods on the date of removal.