Material used for R & D Purpose

[Guest]

Dear Sir,

We are a manufacture if we use some raw material for R & D purpose and on these material we taken Cenvat Credit so when we issue the stock for R & D purpose at that time we need to reverse the excise duty on that material or not ?

Regards

Swapneswar Muduli

[KASTURI SETHI]

Yes you can take cenvat credit. It is in relation to the manufacture of final product. Pl. note that R & D is very much basis of qualitative product. Goods are not marketable without quality.

AI Summary

Cenvat credit allowed for raw materials used in R&D when related to the manufacture of the final product. The advisory confirms that Cenvat credit may be availed on raw materials issued for R&D if that R&D use is in relation to the manufacture of the final product, noting that R&D underpins product quality and marketability.