availing cenvat credit-reg

[Guest]

Dear Sir,

Can cenvat credit be taken on payment of tax for past clearance if show cause notice is issued if the amount is paid before contesting the scn. If possible, kindly give reasons in either case to satisfy the deptt.

AI Summary

CENVAT Credit Denied if Tax Paid Before Contesting SCN Alleging Fraud; Interest and 25% Penalty Apply A discussion on a forum addresses whether CENVAT credit can be availed if tax is paid before contesting a show cause notice (SCN). The consensus is that if the SCN alleges fraud or misstatement, credit is not allowed, and the amount goes to the consumer welfare account. If the tax is paid before contesting, interest and a 25% penalty must be paid, and no CENVAT credit is allowed. The issue arises from a builder's audit where tax was paid under pressure, and contractors later paid their liability. The forum discusses potential legal outcomes and alternatives for availing credit.