re-export of rented capital goods on which capital goods credit availed

[mohammedshamim shaikh]

Imported the capital goods from sister concern (i.e. no foreign currency paid) on rental basis on payment of appropriate customs duties and availed applicable cenvat credit thereon. Re-exported the said goods without foreign proceeds with the permission of RBI.

Pl guide whether cenvat credit availed are required to be reversed?

[DR.MARIAPPAN GOVINDARAJAN]

What is the purpose of re-exporting?

[shabnoor kazi]

If the capital goods re-exported with the intention that it will not again import then credit need to be reversed. and if the capital goods is intended to import again then need not to reverse provided it should be back in india within the prescribed limit.

[KASTURI SETHI]

When imported goods are not in your possession, the reversal is required. No benefit of export is admissible in the situation explained.

[mohammedshamim shaikh]

It was rented capital goods on which appropriate customs duties was paid . I have no ownership of the goods. Only completion of work, it was re-exported the said CG within three years from date of import. Also, no export incentives availed on re-export viz. duty drawback, etc.

If CG credit requires to be reversed, pl quote the authority. I believe that there is no duty on export. But, it is also fact that no foreign proceeds made at the time import and export as well being sister concern unit.

AI Summary

Reversal of cenvat credit required when rented capital goods are re-exported without intent to return, unless returned within prescribed period.
Where rented capital goods on which Cenvat credit was availed are re-exported and cease to be in the taxpayer's possession, reversal of the credit is required; if the goods are re-exported with the intention and plan to re-import within the prescribed period and are back within that period, reversal may not be necessary.