SSI and cenvat credit

[Asked by Guest]

Dear All ,

 

We have a manufacturing unit which expects to cross threshold limit of 150 lacs in coming F.Y

Can we set-off the duty arsing after 150 lacs with the input  purchase ,where we borne the excise duty???

kindly let us know if any departmental clarification or circular in this regard

 

Thanks & regards

Parth kapoor   

[Rajesh Nathoo]

Dear  Mr. Kapoor ,

   Yes, u can but u can take credit on purshases after you cross the threshhold limit of 1.5 Cr. In addition to this , u can take credit of inuts lying in stock or  inputs contained in Finished goods or inputs contained in WIP ( on the day u cross threshhold limit .)

Thank you for the reply sir . 

If i make myself satisfied, then,  purchases made after 150 lacs will only be eligible for cenvat credit??

Is that the case Sir?

Will appreciate your prompt response :)

 

[Rajesh Nathoo]

Mr. Parth,

  Point of taking Cenvat Credit in Central Excise is when inputs are received in the factory .

Suppose exact removal of your finished goods exceeds 150 lacs at  2.00 p.m 28.12.2013, u can take cenvat credit of inputs received in ur factory after 2.00 p.m .

Thank u very much sir 

Appreciate your time 

[DEV KUMAR KOTHARI]

I agree with replies by Mr. Rajesh Nathoo.

It would be better to have clear cut cut off time rather the date of crossing limit for all related purposes - clearance of goods, receipt / issue / availaing of goods and services as input.

[Rajagopalan Ranganathan]

Sir 

     Once you have crossed the SSI exemption limit of 150 lakhs and started payment of duty you can take credit of duty paid on inputs, inputs contained  in unsold stock of finished goods, inputs contained in work in progress etc.  You may also take 100 percent of duty paid on the capital goods in the same financial year when you have crossed the SSI exemption limit of 150 lakhs.

AI Summary

SSI exemption threshold crossing permits cenvat credit for inputs received thereafter and for stock, WIP and finished goods inputs.
Once the SSI exemption threshold is exceeded and duty payment begins, cenvat credit is available for inputs received in the factory after the moment of crossing and for inputs lying in stock, inputs contained in unsold finished goods, and inputs contained in work in progress as at that date and time. Additionally, the assessee may claim one hundred percent of duty paid on capital goods in the same financial year when the threshold is crossed. A clear cut off time on the day of crossing is recommended for administrative clarity.