Clearance of material against Cenvat credit.

[GOUTAM GHOSH]

1) In a situation like:-

On 01.05.2011- there was no Cenvat Credit available or P.L.A. Balance. Materials had to clear involving Excise Duty 25000.

On 02.05.2011- Some credits were availed from purchase of inputs amounting to Rs. 30000.

Now question is- how duties on 01.05.2011's despatch will be adjusted? Can this duty be adjusted against Cenvat credit?

2) There is a balance of Rs. 25000 in PLA and RS. 30000 in CENVAT Credit.

A despatch is made involving duty Rs 45000.

Now the question is- whether a single despatch (invoice) can simultaneously be adjusted for Rs. 25000 in CENVAT and Rs 20000 in PLA?

Please advise.

AI Summary

Cenvat credit adjustment may be applied with PLA to meet excise liability for prior-month clearances.
Excise duty on clearances in a month is generally payable in the next month; Cenvat credits and PLA balances available up to the last day of the clearance month may be used to discharge that liability, and a single dispatch's duty may be met by simultaneous adjustment from both Cenvat credit and the Personal Ledger Account, subject to applicable exceptions.