Cenvat Credit on Deemed Export

[Mr.KISHOR RAJGARIA]

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.

AI Summary

Cenvat credit on deemed export: credit maintained for supplies against ICB under Rule 6(6)(vii), not treated as exempted excisable goods.
Rule 6(6)(vii) Cenvat Credit Rules, 2004 provides that where excisable goods removed without payment of duty are similar to goods which, if imported, would be exempt from customs duties and are supplied against International Competitive Bidding, sub rules (1)-(4) of Rule 6 do not apply. Consequently, Cenvat credit on inputs and input services used in manufacture of goods supplied against ICB is not to be denied, and such ICB supplies are not treated as exempted excisable goods for the purpose of those adjustment provisions.