Captive Consumption

[JSWSEVERFIELD STRUCTURESLIMITED]

 

Dear Sir,

We are using some of our Intermediate products within the factory as captive consumption., and we have raised the Self Invoice by adopting Rule 8 of the Valuation Rules and discharged the duty.

 My query here is am i eligible to avail Cenvat Credit on the Invoice raised by us as Self.

Please offer your valuable suggestions for availing cenvat credit.

Regards,

 

ChittiLal. Agarwal.

[ajay singh]

Dear ChittiLal. Agarwal.

You have to certify the cost of production on the basis of CAS- 4, from a cost accountant in practise, and on the basis of that certificate you can avail credit.

[shamanthaka mani]

Notification No. 67/95-CE dated 16.3.1995 as amended exempts the intermediate goods if captively consumed from payment of duty.   Therefore you need not pay duty on such goods just raising an invoice with a mention exempted udner Notification No. 67/95-CE  dt.16.3.1995 is sufficient  

[NEERAJ KUMAR, RANCHI]

Dear Mr Agarwal

Mr. Mani has correctly mentioned that as per notification no. 67/95 u need not pay duty for captive consumption of intermediate goods. But as far as your question is concerned that yo have issued invoice as per rule 8 of valuation rule that means on the basis of 110 % of the cost of productionn and paid duty accordingly on that. So in my opinion there is no prohibition in taking credit of that amount.

Regards,

Neeraj

[shamanthaka mani]

Yes, as Mr. Neeraj said credit can be availed on the basis of your invoices.  There is no problem.

[NEERAJ KUMAR, RANCHI]

To add further to my reply, a CAS 4 certificate may be required by the department.

[kothapally Raji Reddy]

Dear Agarwalji

Shri Shamanthaka Mani gave a correct reply by advising you to avail exemption under notification 67/95CE .

rrkothapally

[Snehal Kulkarni]

 

The advise given by Mr shamanthaka mani is correct. There is no need to pay the Excise Duty,

 

[YAGAY andSUN]

Mentioning the Notification 67/95 is mandatory while issuing invoices for captive consumption.

AI Summary

Captive consumption exemption permits invoice based treatment and allows Cenvat credit if duty was paid or cost certification provided. Intermediate goods used as captive consumption are exempt under Notification No. 67/95 CE and invoices should reference that exemption. If a self invoice is raised under the Valuation Rules and duty is discharged, Cenvat credit can be availed on those invoices, subject to departmental requirements such as a cost accountant certificate (CAS 4) to substantiate production cost and support the credit claim.