Reversal of cenvat credit

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

05 August 2013 During the audit I have come across the following issue. Assesse has purchased Machine in FY 11-12 on which duty is paid RS. 83500. Assesee availed and utilized credit.In 12-13 he sold machine for rs. 400000/-. Duty collected from buyer 48000(12% of 4 lac Transaction value).As per calculation he has reduced 10 %(2.5% for 4 Quarter)from Rs.83500.Hence Cenvat credit needs to be reversed Rs. 75150.However he has reversed 27150 from cenvatcredit and balance 48000 paid through PLA. My query is whether whole 75150 are required to be reversed? whole 75150 should be pass on to buyer?

Arun Kumar Singh

Arun Kumar Singh (Expert)
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05 August 2013 You can reverse the cenvat credit from credit account or PLA account also or both.

Querist : Anonymous

Querist : Anonymous (Querist)

05 August 2013 Here assesee debited 27150 to P&l account. However it relating to asset hence it should be capitalised.? If it is ralating to inputs is it should be debited to p &l . And if so it should be allowed under 43 b even if same is adjusted though cenvat.?

Querist : Anonymous

Querist : Anonymous (Querist)