Eligibility of Cenvat credit used for export of goods

[AJAY KUMAR]

It may please be clarified whether the Cenvat credit need to be reversed in case when the final products are exported. It may also be clarified if the Inputs, as such, are removed from the factory for export, whether cenvat credit availed on such inputs have to be reversed or not. Because nowhere in the Cenvat Credit Rules, 2004 it is stated that Cenvat credit shall not be reversed if the goods are cleared without payment of duty for export.

AI Summary

Cenvat Credit Retained for Exported Goods Under Rule 6(6) of CENVAT Credit Rules 2004; No Reversal Needed A participant in a discussion forum inquired whether Cenvat credit needs to be reversed when final products are exported or when inputs are removed from the factory for export. A respondent clarified that according to Rule 6(6) of the CENVAT Credit Rules 2004, Cenvat credit does not need to be reversed for goods cleared for export. Exports are tax-free under the Indian Constitution, and taxes paid on inputs can be claimed as rebates or refunds. If inputs are cleared domestically, the duty equivalent to Cenvat availed must be paid, utilizing Cenvat credit for payment.