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Cvd 3(1) and cvd 3(5) credit

Ankur Saini (employess) (24 Points)

23 February 2012

hello friends, Please clear one doubt relating to excise

if a company is getting exemption from payment of excise duty on finished product but liable to pay vat on the sale
and company is making import of raw material and paid a CVD 3(1) and CVD 3(5) as per custom law then the credit of both is available to the co. or not

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6 Replies

neeraj (CA) (930 Points)
Replied 23 February 2012

Will get credit of CVD 3(5) but i don't think it will get credit of 3 (1).

Mallikharjun (Deputy Manager) (304 Points)
Replied 23 February 2012

Even if you get credit of 3(5), you cant utilise it since your final product is exempted one. Regarding 3(1), you need not pay at all while importing. You can show that your FG is an exempted one and need not pay CVD for your inputs.

Rakshit (practising) (338 Points)
Replied 23 February 2012

Under Rule 3(1) of the Cenvat Credit Rules,2004, a manufacture or producer or provider of output service may be allowed credit of various duties/tax including CVD 3(1) & 3(5) provided the inputs are used in the manufacture of dutiable final product. As you are exempt from excise duty, you are not eligible for any credit.

Regards

Advocate Raksh*t Verma

CA sumit chejara (ca final) (99 Points)
Replied 24 February 2012

Dear friend u can not claim credit of CVD 3(1) as your final product is non dutiable, and a manufacturer can never be claim of credit of CVD 3(5) it only availabe to trader.

Mallikharjun (Deputy Manager) (304 Points)
Replied 24 February 2012

No... A manufacturer can also claim 3(5) credit i.e., Additional duty of customs (in lieu of sales tax) and can utilise the same for payment of BED.

VED PRAKASH (ACCOUNTANT) (33 Points)
Replied 22 June 2012

... A manufacturer can also claim 3(5) credit i.e., Additional duty of customs (in lieu of sales tax) and can utilise the same for payment of BED. please clear rule or notification