Cenvat credit on machines utilised both for own manufacturing as well as job work.

[Narendra Soni]

Dear Expert,

We are manufacturer and also doing job work of other units.Our machines are utilised both for our own manufacturing as well as job working.Can we avail cenvat credit on machines which are utilised both for own manufacturing and job work products.

Tahnks.

[YAGAY andSUN]

Dear Sir,

It is settled legal position that if Capital Goods are being used for manufacturing of dutiable as well as exempted goods, even then CENVAT credit on such capital goods would be available. The only condition in this regard is that Capital Goods should not be used exclusively for manufacturing of exempted goods.

Regards,

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

[DR.MARIAPPAN GOVINDARAJAN]

I endorse the views of Yagay and Sun

[KASTURI SETHI]

Undoubtedly Yagay and Sun have correctly replied. Clearly explanied.

AI Summary

Cenvat credit availability affirmed where capital goods serve both own manufacture and job work, provided not exclusively for exempted production. Cenvat credit is available on capital goods used both for a manufacturer's own dutiable production and for job work, provided those capital goods are not used exclusively for manufacture of exempted goods; shared use for dutiable production and job work does not disqualify credit.