Input as Such

[POLYPLEX CORPORATIONLTD]

Dear Expert

We had purchased some chemical in 2013 @ 180/- per litre. Now these Chemical is going to expire and customer give quotation to buy @ 30/- per Litre. As Chemical is our input material we take cenvat credit @ 12.36% accordingly in year 2013.

How to sell these chemical and on what the duty rate should we apply whether 12.50% or 12.36%

If we cleared input as such, we have to reverse the Central Excise Duty and recovers from customer. As duty amount is huge,customer decline to pay that duty amount. Kindly suggest in there is any other option?

Kindly suggest.

Sarvesh Bansal

AI Summary

Company Must Reverse Cenvat Credit for Expired Chemicals, Faces Challenges with Customer Payment Refusal Under Cenvat Credit Rules, 2004. A company inquired about selling chemicals purchased in 2013 at a reduced price due to their impending expiration. They initially took Cenvat credit at 12.36% but are unsure whether to apply a 12.50% or 12.36% duty rate upon sale. The issue arises because reversing the Central Excise Duty and recovering it from the customer, who refuses to pay, is problematic. An expert advised that under Cenvat Credit Rules, 2004, the company must reverse the credit taken, regardless of the financial impact. Another expert noted that the company must accept the consequences of this requirement.