Time limit of one year - Cenvat rules

[Asked by Guest]

Dear Sir, As per nothing cation 6 / 2015 central excise notification nt the time limit of one year to avail cenvat credit will be applicable for those credit which were availed beyond 6 months as per previous time limit.pls explain, thanks and regards

[Rajagopalan Ranganathan]

Sir,

Before issue of Notification No. 6/2015-CE (NT) dated 1.3.2012 the third proviso to rule 4(1) of CENVAT Credit Rules, 2004 read as "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.

Now the above referred Notification substitute the word " six months" by the word "one year". This Notification comes into effect on 1.3.2015. Therefore on 1.3.2015 if the invoice date is within one year, that is, invoice was issued on or after 1.3.2014 then you can take credit. Even in respect of invoices which you had not taken credit due to old proviso now if the date of such invoices are on or after 1.3.2014 now you can avail the credit. This is my opinion.

Dear Sir, Thanks for the reply but pls explain what about the credit which we had been already availed which was beyond of 6 months as per earlier 6 months time limit rule so whether it would be OK or whether it would be required to be reverse ,please explain

[DR.MARIAPPAN GOVINDARAJAN]

I want clarification in time limit for availing CENVAT credit:

The said procedure is in vogue with effect from 01.09.2014 as per notification issued in July 2014. and now it is one year. Time might have been given for the invoices which is more than six months/one year to avail credit as in the case of MODVAT. as informed by one of my learned friend. There are more vouchers in our company for availing credit i.e., pertaining to the year 2013. Whether credit could be availed for these invoices? If availed whether it is to be reversed? I want the clarifications from experts.

[Rajagopalan Ranganathan]

Sir,

If you have taken the credit beyond 6 months on or prior to 28.2.2015 then it will be wrongly availed credit and the same is to be reversed subject to the provisions of rule 14 of CENVAT Credit Rules, 2004. After doing so you can take the same on or after 1.3.2015 since it is within one year from the date of the invoice. However a word of caution. You have to ascertain the view of the Department through your range officer. He may say that only invoices received by you along with inputs on or after 1.3.2015 are eligible for the limit of one year. If he says so then it will result in unnecessary litigation.

AI Summary

Cenvat credit time limit extended to one year; credits wrongly availed under six month rule must be reversed before reclaim.
The one year substitution for the prior six month proviso (effective 1.3.2015) makes invoices dated on or after 1.3.2014 eligible for CENVAT credit; credits wrongly availed beyond six months on or before 28.2.2015 should be reversed under Rule 14 and may be re availed thereafter if within the one year invoice date window, subject to departmental interpretation risk.