Eligibilit of cenvat credit

[MANOHARAN ARUMUGAM]

For imported inputs we are paying CVD & SAD etc. under incentive scrips i.e. FMS/FPS/MLFPS. Whether these duties are eligible for cenvat credit? Please clarify with cases laws, if any.

These scrips are issued under Chapter - III of Foreign Trade Policy.

A.Manoharan

[CSSANJAY MALHOTRA]

Dear Manoharan,

Duty (CVD & SAD) paid from Duty Credit Scrips are eligible for CENVAT Credit. Please refer Central Excise Notifications No. 29/2012 & 30/2012 dated 09.07.2012 (Clause 2j)

Hope above clarifies your concern.

[B. Naga Rami Reddy]

You are eligible for credit as per as per condition vi of the Customs Notifications No. 92/2009(FPS) and 93/2009(FMS). However, if you are a service provider, you are not allowed 4% CVD under levied Section 3(5) of the Customs Tariff Act..

If the goods are sourced indigenously, but not imported, cenvat credit is eligible as per Central Excise Notifications as rightly mentioned by Shri Sanjay Malhotraji.

[CSSANJAY MALHOTRA]

Dear Mr.Manoharan,

Additions made by Mr. Reddy is correct in response to my submissions which pertains to domestic supplies only.

Thanks Mr. Reddy.

AI Summary

CENVAT credit for duties paid via foreign trade duty credit scrips is eligible, subject to notification conditions and service-provider limits. CENVAT credit is available for CVD and SAD paid via duty credit scrips under Chapter III of the Foreign Trade Policy, in terms of Central Excise Notifications No. 29/2012 and 30/2012 (clause 2j) and the conditions in Customs Notifications No. 92/2009 and 93/2009. Imported inputs whose duties are discharged through such scrips qualify for credit, while domestic supply credit follows Central Excise notification rules and service providers face specific limitations under the Customs Tariff Act mechanism.