Procedure for obtaining exemption from Excise /Customs duty on inputs acquired for supplying to a Power project client

[Sandhya Srinivas]

We supply our product to clients like BHEL executing mega power projects. The purchase orders are given on a Excise Exempt basis and Project Authority Certificate (PAC) is provided to us with our name as a supplier to enable us to invoice the client without Excise.

How do we obtain the same benefit ( excise/customs exemption) when we in turn procure inputs( both domestic and imported) from our suppliers?.  Do we need to ask our client to include our supplier names in the original PAC that they provide or a seperate PAC has to be obtained and if so by whom or do we need to approach our Excise Jurisdiction for the same. Kindly clarify.

 

AI Summary

Excise exemption for power-project supplies: supplier eligibility and Cenvat credit availability clarified for inputs and PAC requirements.
Entitlement to duty exemption and Cenvat credit for supplies to power projects depends on the applicable notification, Rule 6 of the Cenvat Credit Rules, and the scope and recipient details in Project Authority Certificates; provisional mega projects may operate under PACs backed by Bank Guarantees allowing vendors and subvendors to clear goods duty-free, while Cenvat credit or refund availability varies with the statutory scheme and mixed judicial precedent.