Cenvat on capital goods

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This query is : Resolved

SHAMBA PEDNEKAR (Querist)

17 November 2011 A unit was providing services (Job work-Machining) & partially manufactures engineering goods. Service tax being paid on Business Auxaliary services & for manufactured goods SSI exemption were availed being sales below Rs.1crore. During the year 2006 unit have availed CENVAT credit on Machinery of Rs.300,000/-(in service Tax records) which was partially used for manufacturing goods & partially job work. The CENVAT amount was partly used for payment of service Tax. The balance to the Cenvat credit was Rs. 250000/- as on 31.3.2009 remained unutilised as unit stop rendering Job work services & only continued manufacturing goods. Since Service job is stop what is to be done for this CENVAT credit balance, is it to be carried forward or can be utilised for Excise duty on manufactured goods as unit started paying excise from 2010 without awailing any SSI benefit & same machines are being used for Manufacturing goods.

Madhukar N Hiregange

Madhukar N Hiregange (Expert)

21 November 2011 Yes as now you are paying the CED the credit on the machinery used tomanufacture excisable goods is eligible and youmay utilise the same.

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