TaxTMI 
TaxTMI 
Dear sir,
We have planned to purchase a Diesel Generator set for our Paper Industry. Can we take Cenvat Credit on the Purchase of Generator?.
Is there is any dispute in taking Credit.
Kindly reply.
Taking Cenvat Credit on Purchase of Gen set - reg.
22 Feb 2012 
4 Replies 
10660 Views Asked by
Cenvat credit on generator sets permitted when used for manufacturing or captive electricity supply; phased availment subject to rules.
Cenvat credit is available on diesel generator sets that qualify as capital goods and are used to supply electricity for manufacturing or captive consumption. Generating sets are treated as capital goods under judicial interpretation even if not directly used in production, provided they are used in the manufacturer's factory. Regulatory rules permit credit for generators supplying electricity for captive consumption outside the factory, and credit may be availed in a phased manner after installation subject to compliance with procedural requirements. (AI Summary)
Cenvat credit is available on diesel generator sets that qualify as capital goods and are used to supply electricity for manufacturing or captive consumption. Generating sets are treated as capital goods under judicial interpretation even if not directly used in production, provided they are used in the manufacturer's factory. Regulatory rules permit credit for generators supplying electricity for captive consumption outside the factory, and credit may be availed in a phased manner after installation subject to compliance with procedural requirements. (AI Summary)