Some queries relating to cenvat credit

Q-1 When there is a provision of reversal of Cenvat credit on removal of capital goods , then why 100% credit is allowed if capital goods are removed in the year of purchase ? I mean that , jab credit reverse hi karni h toh phir full credit kyon?

Q-2 Under rule 5 of CCR  words- Export under Bond or letter of undertaking has been used what does that imply?

Q-3 If CCR on inputs directly sent to job worker for producing intermediate goods is allowed under Rule 4(5)(b), but what

about inputs directly sent to Job worker for production of Final products ?

Q-4 Word Captive Consumption(used in Rule 8 of CE valuation) vs  Home Consump(used in Rule 5,CCR),

Is there any difference b/w these two words?

Q-5 Wheather Cenvat cr of ST pid under reverse charge  is allowed under Rule 4(7) when payment is made in two or more parts?

 

Please clarify my doubts ...Your response will be really appreciated

Thanks in Advance

Replies (3)

1. when you have to clear the capital goods within 1st year, then the next buyer may need input credit, so 100% credit available and reversal is allowed to ease the transaction

2. read the notification no 42/2001 to understand

/notice_circulars/this-notification-specified-the-procedure-for-export-under-bond-without-payment-of-duty-3354.asp

3. when the job worker produce the "final product" then he is not ranked as job worker, but deemed manufacturer, and has to pay duty on total marketable value of goods.

for balance, 4 and 5 please repost your query with exact what you want to know, otherwise its not possible to post total chapters and manuals. 

In Q-4 I mean to ask that what is the difference b/w Home consumption and captive consumption .

Home Cons has been used in CCR, Rule 5 wheareas Captive consumptioin has been used in Valuation Rule,8? I guess that Home consumption is the use for personal purpose and captive consumption is use within th factory. Pls clarify.

In Q-5 I mean that credit for  ST paid under Reverse charge is allowable if payment to Serevice provider is made in parts , I here mean that wheather the credit (ST) attributable  to part payment is allowed  if till date only part payment has been made?  

 I wholeheartdly thanks for your response.

3) Home consumption means the goods cleared for use within india to customers ( clearance made at factory gate for customers outside), while the captive consumption indicates manufacture of intermediate goods to be used in final products. 

an example, RMC ( ready mixed concrete) is used in buildings, and building is not taxable, but RMC is taxable, so the client can take input credit on cement and pay duty on RMC, ( captive goods)

 

4) when the service bill  is received and recorded by the payee the ST is due, and it does not relate with payment method, so whole the ST is payable in one lot and credit is available , provided the service is used directly in providing taxable service or taxable goods. 

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