ER1 Return

[Rudrayani Shedjale]

Hello

We filed for refund of accumulated cenvat credit under Rule 5 vide notification no.27/2012-CE(NT) dated 18.06.2012

We received refund in terms of cash as well cenvat credit.

it is clear to me that the amount sanctioned in terms of cenvat credit can be shown in ER1 returns.

But how to show the amount received in terms of cash in the excise returns we file??

because of this our ER1 closing balance & cenvat part II balance don't match.

please advise.

[Rajagopalan Ranganathan]

Madam,

Refund given in the form of credit in Cenvat Account will reflect in E.R.1 Return as fresh credit earned. However refund received in cash need not be reflected in E.R.1 Return. This is my understanding.

[Ganeshan Kalyani]

I agree with the views submitted by Sri Rajagopalan Sir.

[Suryanarayana Sathineni]

Dear Friend

As per my remembrance, in terms the Notification of Refund under Rule 5 of CCR,2004, at the time of claiming refund it self you need to reverse the refund amount as per the application from your cenvat credit account and after receipt of refund if, any in form of credit you need to take the same as credit. These entries , being reflected in the Return, you need not required to incorporate the cash refund in your returns,

Best Regards

Suryanarayana

[Rudrayani Shedjale]

many thanks for your information.

Mr. Suryanarayana Sir, at the time of refund claim, we have debited the amount of claim from cenvat part 2.

AI Summary

Cenvat refund treatment: credit refunds appear in returns as fresh credit while cash refunds are excluded. Amounts sanctioned as Cenvat credit must be recorded in the ER1 return as fresh credit earned; cash refunds are not reflected in ER1. At the time of claim the taxpayer reverses the claimed amount from Cenvat Part II, and any credit received thereafter is taken into the Cenvat account and will appear in returns, explaining mismatches between ER1 closing balances and Cenvat Part II balances.