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cevat utilization

prachee (Indirect Tax) (167 Points)

01 August 2008

i am working in a manufaturing company , we have having credit balance in CENVAT account( BED, Cess ,S cess), i have a doubt that if we are removing goods for export on payment of duty under rule 18 of C.E.R , is it necessary to take the utilization of Cenvat amount everyday or we can do it at the end of the month.

Do any have any case law for supporting..

regards

Prachee

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7 Replies

Darshan (Service) (54 Points)
Replied 01 August 2008

Surely You can take Monthly Also.....There is no restriction as such....

prachee (Indirect Tax) (167 Points)
Replied 01 August 2008

Dear Mr. Darshan

it was asked by our range inspector to do daily entry in books , if you have any reference or case law for that

SANJOO (WORK) (26 Points)
Replied 01 August 2008

You will have to debit ED (Excise Duies) on each of the export consignment for removal of goods for exports from your factory. This is becz, while claiming rebate (i.e. ED paid on exports) from the excise dept, you will have to mention SR No/Date of the ED so paid by you. Not only this, you will also require to attach a copy of the relevent pg of Cenvat records on which such ED is paid. Based on which excise dept shall settle your rebate claim and will issue cheque for the ED paid by you.

Hence, range exicse insp is right here.

The second aspect - which Darshan has mentioned is for the Monthly payment of ED is on removal of goods for HOME CONSUMPTION - i.e. within the country, which I suppose was not the question here.

Sanjay Dwivedi (Advocate & Consultant) (143 Points)
Replied 01 August 2008

The duty on export under rule 18 can be paid at the end of the month. This is provided by the CBEC itself.

Chapter 8, Part I of the CBEC's C. Excise Manual of Supplementary Instructions is concerned with export under claim for rebate to all countries except Nepal & Bhutan. Para 4.2 thereof reads as under:

"The duty payable shall be determined on the ARE-1 and invoice and recorded in the Daily Stock Account and it should be paid in the manner specified in rule 8 of the said rules"

Rule 8 specifies that the duties are to be paid on monthly basis and not consignment wise.

OFFICESELVA (Service) (515 Points)
Replied 01 August 2008

Actually department officers cannot force the exporter to debit duty at the time of clearance. However, it is in the exporters interest that the same is done, so that it is easy to furnish evidence for payment of duty and to get rebate.

Further, assume that you have made export today i.e. on 01/08/2008. by AIR. You will get the documents for claiming rebate mostly within 7 to 10 days. But, you will make the debit only on 05/09/2008. Thereafter, only you can file claim for refund.

What is the financial benfit you get by keeping the cenvat credit in your book of accounts?