Reversal of cenvat credit

[Sanjeev Chauhan]

To all,

Sir,

 

Suppose a manufacture has availed credit on the strength of an Invoice where the price is Rs.100 and duty pass on is Rs.12.36 and later he receives credit of rate differnece of Rs.10. Mean to say that the actual amount he has paid is Rs.90 but credit take is Rs.12.36. Now , is the manufacturer is liable to reverse proportionate credit on Rs.10.

[SHIVKUMAR SHARMA]

Dear sanjeev

If  The Customer is paid a Sum of Rs.90+12.36 ,Than he  no need to reversed  Rs.1.24 .Because he received the Credit not of  basic Value only & not differential amt.of excise duty from supplier of excisable goods.

 

Shivkumar Sharma

[Sanjeev Chauhan]

Sir ,

Thanks a lot.

AI Summary

Reversal of cenvat credit: price adjustments do not automatically mandate proportional credit reversal when duty was invoiced.
Reversal of Cenvat credit is questioned when a manufacturer avails credit on duty shown on an invoice and later receives a price reduction; the forum reply indicates no reversal is required where the recipient receives the reduced basic amount together with the excise component reflected in the supplier's invoice, as the credit pertains to the duty component shown by the supplier rather than the basic value adjustment.