Utilisation of unclaimed cenvat

[Guest]

Dear Sir, Suppose a Co. has opted to take Cenvat credit on % basis .i.e provisional ratio of 2007-08 income basis and reversed Cenvat for Exempted portion viz Rs. 100 is admissable but 7% reversed on the basis of ratio ( Exempted : taxable)and out of balance Rs. 93 one has utilized Rs. 50 only and thus balance untilized cenvat is 43 . On 31.03.09 recalculate ratio on the basis of actual income and exemption ratio become 20% accordingly he reversed further Rs. 13 and now unutilized amt is Rs. 30. My query is : 1. Can he utilize unclaimed Rs. 30 in 2009-10 for pymt or he shd reverse it and book exp? 2. Should he inform this to dept before 30 June Manoj

[Prabhakar Vennalaganti]

There is no such provisions under Cenvat Rules to avail on percentage base.

[Guest]

Sir, Actualy percentage is calculated as per Rule 6 ( 3) this is cenvat for common input and percentage is Exempted :Actual basis Thanks Manoj

[Guest]

If you by the scheme of rule 6(3) read with rule 6(3A) carefully, the purpose of formula is to reduce the amount of cenvat credit by an amount which is allocatable towards exempted services. Therefore, after reducing the amount, the balance amount is eligible for utilization without any limit. further the calculations, adjustments etc. should be intimated as per procedure prescribed therein.

AI Summary

Company Queries Utilization of Rs. 30 Unclaimed Cenvat Credit After Recalculation; No Percentage-Based Limitations Found A company inquired about utilizing unclaimed Cenvat credit after recalculating the exemption ratio based on actual income. Initially, Rs. 93 was available, with Rs. 50 utilized, leaving Rs. 43 unutilized. After recalculating, an additional Rs. 13 was reversed, leaving Rs. 30 unutilized. The query was whether this Rs. 30 could be used in 2009-10 or should be reversed and booked as an expense, and if the department should be informed by June 30. Responses indicated no provision for percentage-based Cenvat under the rules, but the unutilized amount could be used without limit, following the prescribed procedures.