Reversal of cenvat credit under Rule 6 of CCR 2004.

[VINOD KUMAR]

Dear Experts. GOOD AFTERNOON. Sir, one of my client has exported goods to Nepal. The export proceeds will be received in Indian Rupees. Now, the Range officer says that it is exempted service and my client needs to reverse Cenvat credit under Rule 6 of CCR 2004. Please provide your valuable opinion whether he is right or not. Thanks and warm regards.

[Rama Krishana]

Your query is related to Export of Goods or Export of Services?

In case it is export of goods, you need to follow the procedure under Notification No. 42/2001 CE(NT) or any other relevant notification.

Once you follow the prescribed procure and goods are not exempt generally under any other notification, you may retain the amount of Credit in your account since the goods will not qualify the status of exempted goods.

AI Summary

Cenvat credit reversal may be unnecessary for exported goods if prescribed export procedures are complied with and goods are non-exempt. Where goods are exported and proceeds are received in domestic currency, determine whether the transaction is export of goods or services; for exports of goods follow the prescribed export procedure under the relevant notification, and if those procedures are complied with and the export is not covered by an exemption under any notification, the supplies will not qualify as exempted goods and the exporter may retain the Cenvat credit rather than reverse it.