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Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise and Customs
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Circular No.: 990/14/2014-CX-8
New Delhi, the 19th of November, 2014
To,
Principal Chief Commissioners/Chief Commissioners of Central Excise (All)
Principal Chief Commissioners/Chief Commissioners of Central Excise of Central
Excise & Customs (All)
Director General, Directorate General of Central Excise Intelligence
Principal Commissioners/Commissioners of Central Excise (All)
Principal Commissioners/Commissioners of Central Excise & customs (All)
Web-master, CBEC
Madam/Sir,
Sub: Clarification regarding availment of CENVAT credit after six
months-reg.
Attention is invited to the Notification of the Government of India in the
Ministry of Finance, Department of Revenue
No. 21/2014-CE (NT) dated 11.07.2014,
vide which, inter alia, amendment was made in Rule 4(1) and 4(7) of CENVAT
Credit Rules, 2004 (CCR, 2004) to prescribe that manufacturer or output service
provider shall not take CENVAT credit after six months of the date of issue of
any of the documents specified in sub-rule (1) of Rule 9.
- Concerns have been expressed by trade that in view of above changes,
the re-credit taken in following three situations may be hit by the time
limit of six months prescribed:
- 3rd proviso to Rule 4(7) of CCR, 2004 prescribes that if the payment of
value of input service and service tax payable is not made within three
months of date of invoice, bill or challan, then the CENVAT Credit availed
is required to be paid back by the manufacturer or service provider.
Subsequently, when such payment of value of input service and service tax is
made, the amount so paid back can be re-credited.
- According to Rule 3(5B) of CCR, 2004, if the value of any input or
capital goods before being put to use on which CENVAT Credit has been taken,
is written off or such provisions made in Books of Account, the manufacturer
or service provider is required to pay an amount equal to credit so taken.
However, when the inputs or capital goods are subsequently used, the amount
so paid can be re-credited in the account.
- Rule 4(5)(a) of CCR, 2004 prescribes that in case inputs sent to job
worker are not received back within 180 days, the manufacturer or service
provider is required to pay an amount equal to credit taken on such inputs
in the first instance. However, when the inputs are subsequently received
back from job worker, the amount so paid can be re-credited in the account.
- The matter has been examined. The purpose of the amendment made by
Notification No. 21/2014-CE (NT) dated 11.07.2014 is to ensure that after
the issue of a document under sub-rule (1) of Rule 9, credit is taken for
the first time within six months of the issue of the document. Once this
condition is met, the limitation has no further application. It is,
therefore, clarified that in each of the three situations described above
pertaining to Rule 4(7), Rule 3(5B) or Rule 4(5) (a) of CCR, 2004, the
limitation of six months would apply when the credit is taken for the first
time on an eligible document. It would not apply for taking re-credit of
amount reversed, after meeting the conditions prescribed in these rules
- Difficulties faced, if any, in implementation of this Circular may be
brought to the notice of the Board. Hindi version follows.
F. No. 267/72/2013-CX.8 (Pt)
(Shankar Prasad Sarma)
OSD, CX.8
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