A manufacturer is also doing trading in non-excisable goods. As per recent amendment in rule 6 of CENVAT credit rules 2004. Manufacturer or Service provider shall follow any one option from either 1) pay 6%/7% or 2) pay an amount as determined under sub-rule (3A)
As per Section 66D (e) Trading is the exempted service.
In this case if we go for 1st option are we need to pay 6% or 7% of value?
Please share your views.
Manufacturer Seeks Clarification on Rule 6 of CENVAT Credit Rules 2004 for Trading Non-Excisable Goods, Must Pay 7%. A manufacturer involved in trading non-excisable goods is seeking clarification on the applicability of Rule 6 of the CENVAT Credit Rules 2004, following a recent amendment. The rule requires choosing between paying 6%/7% or an amount determined under sub-rule (3A) for exempted services, with trading being classified as such under Section 66D(e). A respondent advises that since trading is a service activity, the manufacturer must comply with Rule 6 and pay 7%. (AI Summary)
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