Cenvat credit on capital goods

7. Restrictions on Credit Availment

1. CENVAT credit shall not be allowed on such quantity of inputs or input services which is used in the manufacture of exempted goods or exempted services except in the manner specified. [click here for Obligations of MFP and OSP].

2. No CENVAT credit shall be allowed on CG which are used exclusively in the manufacture of exempted goods or in providing exempted services, other than the FP which are exempt under SSI Exemption Scheme.

3. CENVAT credit on CG shall not be allowed in respect of that part of value of CG which represents the amount of SDT on such CG which the manufacturer or OSP claims as Depreciation u/s. 32 of Income-tax Act, 1961.

4. In cases where, under a Notification abatements have been claimed by specified OSP, CENVAT credit of duties paid on inputs /capital goods or Service Tax paid on Input Services cannot be availed.

5. In cases where an OSP opts for Works Contract Composition Scheme, CENVAT Credit of duties paid on inputs, cannot be availed