Cenvat credit exempted goods/services (Trading Export)

[RAM SHARMA]

Dear Experts,

We are manufacturer cum merchant exporter, we are doing manufacturing sale and trading sale in domestic market as well as export market. whether our trading export will be treated as exempted service and cenvat to be reverse under rule 6(3) of cenvat credit rule 2004.

Please advice.

Thanks

AI Summary

Exempted trading exports require reversal of CENVAT credit for exclusively used inputs and proportionate credit for common services.
Input services exclusively used for merchant exports are not eligible for CENVAT credit and must be reversed; common input services must have credit apportioned and reduced proportionately on the basis of turnover of each business vertical. A merchant exporter receiving duty drawback for exports is treated as refunded duties and taxes and cannot claim duplicate CENVAT benefit.