This is in relation to the availment of CENVAT Credit on inputs used in manufacturing of goods which are supplied against ICB.
As per N 6/2006 CE - Supply against ICB is exempt from Central Excise Duty. Also as per FTP supplies against ICB is considered as Deemed Export.
Now the question is -
1. As the supplies against ICB is deemed export, whether CENVAT Credit on inputs used can be denied ?
2. Whether the supplies against ICB will be considered as exempt goods for the purpoose of Rule 6 of CCR, 2004 ?
Please advise.
CENVAT Credit Allowed on Inputs for ICB-Deemed Exports; Not Classified as Exempt Under Rule 6(6)(vii) CCR 2004. A query was raised regarding the eligibility of CENVAT Credit on inputs used in manufacturing goods supplied against International Competitive Bidding (ICB), which are deemed exports and exempt from Central Excise Duty. The discussion concluded that, according to Rule 6(6)(vii) of the Cenvat Credit Rules, 2004, CENVAT Credit cannot be denied for such inputs since these goods are not considered exempt for the purposes of Rule 6 of the CCR, 2004. The experts agreed that goods supplied against ICB are not classified as exempt excisable goods, thus allowing the credit. (AI Summary)
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