Cenvat Credit on sample and replacement invoices

[Mathurthi RamKumar]

Dear All,

Greetings of the day.. Kindly confirm that cenvat credit of samples and replacement is claimable or not. (i.e some times machinery supplier send replacement parts with excise invoice. They shows basic amount as discount and excise invoice as per cenvat rule)

Kindly guide me.

Regards

M.RamKumar

[MUKUND THAKKAR]

Dear M,Ramkumar,

if you are cleared your defective part on payment of excise duty than you can availed cenvat credit.

[YAGAY andSUN]

Dear Mathurthi,

Proportioned CENVAT credit and Input Tax Credit, if any, needs to be reversed to avail the CENVAT credit and Input Tax Credit on replaced parts etc. On samples, if these are being used in or in relation to the manufacturing of finished goods then you can claim otherwise not.

Regards,

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

[Mahir S]

If machine is under warranty and such replacement parts are under warranty period, then cenvat credit can be availed, provided the damaged part is returned back to the supplier on excise invoice and on reversal of duty

AI Summary

Eligibility for CENVAT Credit on Replacement Parts: Conditions for Availing and Reversing Input Tax Credit Explained. A user inquired about the eligibility to claim CENVAT credit on sample and replacement invoices, particularly when machinery suppliers send replacement parts with excise invoices. Three responses were provided. The first response indicated that CENVAT credit can be availed if the defective part is cleared with excise duty payment. The second response mentioned that CENVAT and Input Tax Credit must be reversed for replaced parts unless used in manufacturing finished goods. The third response stated that if the machine is under warranty, CENVAT credit is possible if the damaged part is returned with an excise invoice and duty reversal.