Previous period availment of cenvat credit

[Asked by Guest]

Dear Sir,

As per new notification 21/2014 the time limit for availment of cenvat credit is fix for 6 months which is effective from 01.09.2014 , but if we want to avail cenvat or service tax credit of previous period i.e before 01.09.2014 may be one year before then can we avail such cenvat or service tax credit in or after september 2014,please explain,

thanks and regards.

[Rajagopalan Ranganathan]

Sir,

When you take credit on 01.09.2014. you should ensure that the invoice date is within 6 months. For example if the date of invoice is on or after 01.03.2014 you can take credit on 01.09.2014. Otherwise you are not eligible to take the credit.

[Mahir S]

From 01.09.2014, one can avail cenvat credit on invoices issued during the past 6 months period.

For past invoices issued prior to 6 months period, the same can be availed till 31.08.2014, after which cenvat credit shall be eligible on such invoices.

[Mahir S]

For past invoices issued prior to 6 months period, the same can be availed till 31.08.2014; after which cenvat credit shall NOT be eligible on such invoices.

Sorry for the typographical error.

[YAGAY and SUN]

Dear Sandesh,

In our opinion, CENVAT credit on Inputs, input services and capital goods must be availed immediately to avoid any legal hassle in near future. Even if CENVAT credit is not availed then either you can avail the Depreciation on capital goods or you can expense off the whole amount of inputs or input services.

The Government has come with the same erstwhile provision that CENVAT credit should be availed within Six Months. The rational behind this provision is not clear yet to the Trade.

However, we are in agreement with the replies submitted by Mr. Naveed.

Regards

Team YAGAY and SUN

(Management and Indirect Tax Consultants)

[Mahir S]

Thanks Sir .. and Yes very good opinion on the issue from your side.

[Madhukar N Hiregange]

Past credits ----- 2008 onwards - awareness, capturing and availment needs to be done within august. Article posted- Please refer.

Sir ,

can we take cenvat credit of 2008 year invoice in 2014 year in the month of August.

regards,

Pawan

[Rajagopalan Ranganathan]

Sir,

The answer is yes provided you take credit on the basis of invoice issued in 2008 on or before 31.08.2014.

[Akash Bhojwani]

Dear Ranganathan Sir

I had a query about this notification. This notification is came with effect from 1st Sept 2014 so it talk about the cenvat credit from 1st Septmber 2014. Whether it cover the cenvat credit for previous period???

Please explain.

Thanks in advance.

[Rajagopalan Ranganathan]

Sir,

The newly inserted proviso states that-

3. "In the said rules, in rule 4, -

(a) in sub-rule (1), after the second proviso, the following proviso shall be inserted with effect from first day of September 2014, namely :–

“Provided also that the manufacturer or the provider of output service shall not take CENVAT credit after six months of the date of issue of any of the documents specified in sub- rule (1) of rule 9.”;"

This new proviso shall come into effect on 1.9.2014. On this date there shall be a gap of maximum six months between the date of invoice and date on which the credit is taken. If you calculate six months backwards from 1.9.2014 it will fall on 1.3.2014. Therefore according to this proviso, on 1.9.2014 if the invoice issued by the supplier of inputs on or after 1.3.2014 then it will be within six months. If the invoice is issued prior to 1.3.2014 then the credit shall be taken latest by 31.8.2014 for the reason the proviso will come into effect from 1.9.2014.

[Akash Bhojwani]

Thank you Sir

Is there any chances to give extension by department for taking cenvat credit for the assesses who have not taken it by 31.08.2014.

Regards

Akash B.

[Rajagopalan Ranganathan]

Sir,

So far no indications for granting extension. However if Industry makes a representation it may be considered by the government.

AI Summary

Time limit for CENVAT credit restricts retroactive claims; invoices older than the cutoff become ineligible after the effective date.
A proviso effective 1 September 2014 bars taking CENVAT credit after six months from the date of supporting documents; therefore invoices older than the six month retrospective window must have their credit availed on or before the day before the proviso's commencement or they become ineligible thereafter. Taxpayers must ensure invoice dates fall within the permitted backward-looking period when taking credit on or after the effective date; no extension was indicated.