Time limit for availing cenvat credit
This query is : Resolved
04 July 2015
We have a service invoice dated 29/12/14 but we have not availed service tax credit for the same till June 2015. Now as per the recent amendment where time limit for availing CENVAT credit has been increased to 1 Year can we avail the credit of this invoice after June 2015.
Please give your opinion and thanks in advance
Please give your opinion and thanks in advance
04 July 2015
Yes you can avail this credit.
Message likes :
1 times
04 July 2015
Just pass this entry on 29/12/2014.
1) Exp. Dr.
Service tax unaviled credit Dr.
To Party
2)on 1/4/2015
Service tax Dr.
edu cess Dr.
Sec edu Dr.
To Service tax unavailed credit.
3) on utilization
Service tax output Dr.
edu cess Dr.
sec edu cess Dr.
To st input
To edu cess
to sec edu cess.
1) Exp. Dr.
Service tax unaviled credit Dr.
To Party
2)on 1/4/2015
Service tax Dr.
edu cess Dr.
Sec edu Dr.
To Service tax unavailed credit.
3) on utilization
Service tax output Dr.
edu cess Dr.
sec edu cess Dr.
To st input
To edu cess
to sec edu cess.
04 July 2015
Thanks Neelam for your response. But we have not entered any of these entries in our books on these dates as our period closes every month.
So is there any issue from point of view of law as it has not been entered in books
So is there any issue from point of view of law as it has not been entered in books
04 July 2015
Thanks Neelam for your response. But we have not entered any of these entries in our books on these dates as our period closes every month.
So is there any issue from point of view of law as it has not been entered in books
So is there any issue from point of view of law as it has not been entered in books
02 August 2025
Regarding your query about availing CENVAT credit for the service invoice dated 29/12/2014, but credit was not availed till June 2015:
---
### 1. **Time Limit to Avail CENVAT Credit**
* As per **Section 16(4) of the Central Excise Act (prior to GST)** and the **Finance Act amendments**, the time limit to avail CENVAT credit was extended from 6 months to **1 year from the date of invoice or payment, whichever is earlier**.
* So, for an invoice dated 29/12/2014, the deadline to avail credit would be by **29/12/2015**.
* Since you are trying to claim credit by June 2015, it is well within the 1-year limit, so **legally you can avail credit**.
---
### 2. **Issue of Not Passing Entries Monthly**
* From a **legal standpoint**, the key factor is whether the credit is claimed within the prescribed time limit.
* There is **no explicit law mandating monthly bookkeeping entries** for CENVAT credit claim.
* However, **good accounting practice** suggests recording transactions in the period they belong to, to maintain transparency and correctness.
* The tax authorities generally focus on:
* Whether credit is claimed within the timeline.
* Whether proper invoices and payments exist.
* Compliance with other procedural conditions.
---
### 3. **Is there a legal issue for delayed entries?**
* **No direct legal penalty** for delayed accounting entries if the credit is claimed within time and proper documents are available.
* However, if the department asks for reconciliation or audit, **delayed entries might cause difficulty** in explaining or substantiating the claim.
* To avoid disputes, it’s recommended to:
* Pass adjusting journal entries now to reflect the credit.
* Keep all documents ready.
* Maintain clear records for audit purposes.
---
### **Summary:**
| Aspect | Observation |
| -------------------------- | ---------------------------------------------------------- |
| Time limit to claim credit | 1 year from invoice date → You are OK |
| Monthly accounting entries | Not mandatory by law but good practice |
| Legal issue due to delay | No penalty if within time limit and documents are in order |
| Practical advice | Pass adjustment entries ASAP for clarity |
---
If you want, I can help you draft the adjusting journal entries or suggest ways to document this properly for audit compliance. Would you like that?
---
### 1. **Time Limit to Avail CENVAT Credit**
* As per **Section 16(4) of the Central Excise Act (prior to GST)** and the **Finance Act amendments**, the time limit to avail CENVAT credit was extended from 6 months to **1 year from the date of invoice or payment, whichever is earlier**.
* So, for an invoice dated 29/12/2014, the deadline to avail credit would be by **29/12/2015**.
* Since you are trying to claim credit by June 2015, it is well within the 1-year limit, so **legally you can avail credit**.
---
### 2. **Issue of Not Passing Entries Monthly**
* From a **legal standpoint**, the key factor is whether the credit is claimed within the prescribed time limit.
* There is **no explicit law mandating monthly bookkeeping entries** for CENVAT credit claim.
* However, **good accounting practice** suggests recording transactions in the period they belong to, to maintain transparency and correctness.
* The tax authorities generally focus on:
* Whether credit is claimed within the timeline.
* Whether proper invoices and payments exist.
* Compliance with other procedural conditions.
---
### 3. **Is there a legal issue for delayed entries?**
* **No direct legal penalty** for delayed accounting entries if the credit is claimed within time and proper documents are available.
* However, if the department asks for reconciliation or audit, **delayed entries might cause difficulty** in explaining or substantiating the claim.
* To avoid disputes, it’s recommended to:
* Pass adjusting journal entries now to reflect the credit.
* Keep all documents ready.
* Maintain clear records for audit purposes.
---
### **Summary:**
| Aspect | Observation |
| -------------------------- | ---------------------------------------------------------- |
| Time limit to claim credit | 1 year from invoice date → You are OK |
| Monthly accounting entries | Not mandatory by law but good practice |
| Legal issue due to delay | No penalty if within time limit and documents are in order |
| Practical advice | Pass adjustment entries ASAP for clarity |
---
If you want, I can help you draft the adjusting journal entries or suggest ways to document this properly for audit compliance. Would you like that?
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Applicability of TDS on CFS, CHA fees, and shipping line charges
- Notice from IT DEPTT IF FD AMOUNT EXCEEDS 10 LACS
- Unable to generate and save json file for updated return
- GST payable under RCM
- Applicablity on tds
- LTCG offset against property buy
- Tax audit & Switching from Presumptive taxation
- PRODUCT AND SERVICE CATEGORY CODE
- WRONGLY UPLOADED 10IF FOR COOPERATIVE SOCIETY
- GSTR9- ITC
- GST QUERY TO RAISED PROFESSIONAL FEE BILL BY CA
- Place of supply under Gst for tax audit services
- Which SAC code should be selected??
- Import purchase entry
- Rule 54(1A) for Distributing ITC
- EXCESS CREDIT REALTED GST REVERSAL
- Export invoice not reported
- CA Articleship Extension Matter
- GST OFFICER WRONG NOTICE
- "Please ensure that the Total of the Deductions u/s 54F match the same in Table D in Sch CG"
Trending Online Classes
-
LIVE Course on GSTR-9 & GSTR-9C (Technical | Practical | Concept - Based)
Sachin Jain03 November 2025
CAclubindia
