CVD & ADC Credit on Capital

[Umesh Talanpuri]

Sir/Madam,

I started a new Pvt. ltd. Company. We are import 5 machines from USA on 28/02/11, on that period we have not registered with Excise, but get registration on 15/03/13, Can we take credit of CVD & ADC 100% or 50%. of capital items. 

please suggest.

your prompt reply help us.

Thanks..

[Nagabhushan Bhushan]

Dear Sir,

YES you are entitled for the credits of capital goods which are procured before the date of excise registration. There are many Tribunal decision in favor of assessee in this regard. 

In addition to that you can avail the cenvat credit of 100% of ADC and 50% of the CVD credit and related Cess as per the provisions of the cenvat credit rules. 

 

Hope the reply is sufficient for your query. 

AI Summary

Cenvat credit on capital goods: ADC fully allowable and CVD partly allowable for goods acquired before excise registration. Entitlement to cenvat credit on capital goods acquired before excise registration is recognized, subject to cenvat credit rules. ADC on capital items is allowable in full as cenvat credit, while CVD and related cess on such capital goods are allowable only to the extent prescribed by the cenvat credit rules; claims must meet the procedural and documentary conditions when made after registration.