Respected Forum,
Machinery received in the factory and CENVAT taken and utilized
Machinery used for three years. both dutiable and exempted final product manufactured.
My queries:-
1. If i give entire Plant i.e. Land, Building, Machinery on Lease and charge Service Tax on Lease Rent, Am i required to reverse CENVAT taken on Machinery? if yes, whether from CENVAT or PLA?
2. If i do not sell the machinery and keep it as it is then what will be the status of CENVAT?
Please guide me accordingly, also please provide me copy of notification/clarification/decision of any court to satisfy my excise authorities and management
Thanks and regards
No Reversal of CENVAT Credit Needed for Leasing Plant with Service Tax Paid, Experts Advise. An individual inquires about the need to reverse CENVAT credit on machinery when leasing out an entire plant, including land and building, and charging service tax on the lease rent. Respondents clarify that there is no requirement to reverse CENVAT credit if the machinery remains in the factory and service tax is paid on leasing activities. The individual, without a manufacturing license, has leased the plant and machinery, and the lessee provides a taxable service. Despite excise authorities demanding reversal of CENVAT credit, experts advise that no such reversal is necessary under current laws, suggesting legal consultation for further action. (AI Summary)
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