Order of claiming CENVAT Credit

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This query is : Resolved

CA Ysil Karunai (Querist)

14 December 2009 Dear Sir,
Consider this example": for the month of april 09:
1. Input on Capital Goods Rs. 500000(Assume 50% already utilised)
2. Input on purchase, duty paid Rs. 50000
3. Input on service tax, tax paid Rs. 15000.
now,
Duty payable for the month of april for removal Rs. 325000
Calculation:
Total duty paid Rs. 325000
Less:
CENVAT on
- Purhcase Rs. 50000
- CG Rs. 275000
Paid through PLA Nil
Query:
1. From the above calculation, whether CENVAT credit can be claim without claiming of service tax input (assume service tax paid for input services is eligible for CENVAT credit). if yes, Input tax paid on service tax can be avilabe for CENVAT credit for subsequent month or period?
2. is there any priority or order for caliming CENVAT credit on Duty payable goods?

Kishanlal Paliwal

Kishanlal Paliwal (Expert)

15 December 2009 1. Yes, CENVAT credit could be adjusted against duty payable without touching the CENVAT against Service Tax (Input Services). The same could be adjusted subsequently against service tax liability of output services.
2. Their is no priority or sequence for the utilisation of CENVAT, however, in normal practice, we always make the best use of CENVAT credit available.

Regards

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