Goods returned

[Gopal B]

Dear Sir,due to material rejection We get goods back on our invoice. Shall we take cenvat credit on our own Invoice? pls. guide

[YAGAY and SUN]

Dear Gopal,

Yes, you may avail the CENVAT credit on you own Invoice.  Please also check Rule 16 of the Central Excise Rules, 2002 in this regard.

Regards,

Team YAGAY & SUN

(Indirect Tax Consultants)

[Mahir S]

Yes, provided the process to which such rejected goods are subjected before being removed again does amount to manufacture, as explained under sub rule (2) of rule 16 of central excise rules, 2002, and as discussed above by Pradeep Sir.

AI Summary

CENVAT credit on returned goods allowed where post return processing qualifies as manufacture and rules are complied with.
A claimant may avail CENVAT credit on their own invoice for goods returned due to rejection, provided that the processing applied to the rejected goods before subsequent removal qualifies as manufacture and the claimant complies with the procedural and substantive criteria in the excise rules governing returned goods.