cenvat credit on services used for disposal of waste from effluent treatment plant

[Kadayam Ganapathy Subramanian]

Dear sirs,

Whether cenvat credit on services used for disposal of manufacturing waste from effluent treatment plant and for maintenance of such plant set up in a factory is allowed prior to 1.04.2011 and after 01.04.2011 with support of relevant case laws reference if any.

Kindly give your opinion at the earliest.

Regards,

K.G Subramanian

mail ID: [email protected]

[YAGAY andSUN]

Dear K G Subramanian,

We are attaching herewith two judgment for your kind information.

2013 (6) TMI 344 - CESTAT MUMBAI M/s MONARCH CATALYST P LTD Versus COMMISSIONER OF CENTRAL EXCISE, THANE-I Other Citation: 2014 (300) E.L.T. 89 (Tri. - Mumbai),Dated: 23/01/2013, E/1091/11 CENVAT credit on sulphuric acid used for treating the effluents in the effluent treatment plant - denial of claim on the premise that the effluent treatment has taken place after the completion of the manufacturing activity and same does not have nexus with the final product - Held that:- As per Central Pollution Control Board, a manufacturer of these chemicals is essentially required to install effluent treatment plant at their unit. Without installing effluent treatment plant and treating the gases effluents which emerges during the manufacture of these chemicals, the manufacturing process cannot take place. Therefore, treatment of gases effluents is essential part of manufacturing of these chemicals. As appellant has used sulphuric acid as input for treatment of these gases effluents in the effluent treatment plant, which is a process of manufacturing of final product (directly or indirectly), therefore, same is entitled for input credit as per Rule 2(K) of the CENVAT Credit Rules, 2004. In favour of assessee.

2009 (4) TMI 660 - CESTAT, NEW DELHI RUCHI SOYA INDUSTRIES LTD. Versus COMMISSIONER OF C. EX., INDORE Other Citation: 2009 (246) E.L.T. 603 (Tri. - Del.) Dated: 24/04/2009L E/2487/2008-SM Stay/Dispensation of pre-deposit - Cenvat/Modvat

Regards,

Team YAGAY and SUN

(Management and Indirect Tax Consultants(

[Kadayam Ganapathy Subramanian]

Dear Sirs,

Thanks for giving the below mentioned citation references. But these decisions are relating to availment of input credit for treatment of effluent. Kindly give your valuable opinion with citation references regarding credit availment on services as mentioned in our query.

Regards,

K.G Subramanian

Mail ID: subramaniankg@microlabs.in

[YAGAY andSUN]

If inputs are allowed, then, in our opinion input services would also be allowed.

[Yatin Bhopi]

CENVAT credit is eligible for excise duty as well as in service tax also. To produce such type of finished goods (basically chemical industry) effluent treatment plant is an essential activity and it is also part of whole manufacturing process. Without such process State Pollution control board will not give permission to produce the goods.

[sreemannarayana B]

Dear Mr. Subramanian,

There is no big difference between present and prior to 01.04.2011 as far as Cenvat credit availment is concerned. However, basic condition to avail the credit ( Present and past) , such input ( Service or goods) should be an input for the output. Except for the capital goods, all the inputs should have one to one direct nexus with the taxable output. In the present case, you can take the credit of service tax, if you are paying Excise duty on the chemical waste while disposing off. However, you cannot take the credit for the goods you manufacture viz., medicines. Further, if you want take the credit, you should be careful of Rule 6.

Regards

Sreeman.

[Mahir S]

Input service credit for repairs/maintenance of factory/factory plant is allowed both prior and after 01.04.2011.

[HARISH SAHOO]

Dear All,

In our factory we are producing liquid products. Inside factory premises Effluent treatment plant is constructed. After production of finished goods, whatever waste liquid will be generated same will be treated in the ETP. Then Water (not used for Human Consumption) and waste solid will be separated. As per Pollution Control Board Consent approval, we can not run factory with out a ETP.

currently the same ETP is under contract and given to vendor on O & M MONTHLY basis. Kindly clarify the doubt whether I can take service tax credit on such contract exp invoice or not.

Harish

AI Summary

Can CENVAT Credit Be Claimed for Waste Disposal Services in Effluent Treatment? Insights on Pre/Post-April 2011 Rules. A discussion on a forum addresses the eligibility of CENVAT credit for services used in waste disposal from effluent treatment plants, specifically before and after April 1, 2011. The initial query seeks clarity on whether such credits are permissible, with references to relevant case laws. Respondents provide various insights, citing judgments that support the allowance of input credits for effluent treatment, arguing that the process is integral to manufacturing and thus eligible for CENVAT credit. They emphasize that effluent treatment is essential for compliance with pollution control regulations, suggesting that input services should also be eligible for credit.