We have purchased a Storage Tax during 2004 for our plant and availed credit under Capital Goods. The said Tank was sold as scrap during 2010 and paid the duty as per transaction valve. Kindly let us know, whether the duty paid by us is correct or we have to reverse proportionate duty to the extent of CENVAT credit taken by us after considering depreciation 2.5% per quarter from 2004 to 2010.
Regards,
VINAY
Reverse CENVAT Credit on Sold Storage Tank with 2.5% Quarterly Depreciation from 2004 to 2010 A query was raised regarding the reversal of CENVAT credit for a storage tank purchased in 2004, for which credit was availed under Capital Goods. The tank was sold as scrap in 2010, and duty was paid based on the transaction value. The inquirer sought clarification on whether this was correct or if they needed to reverse the duty proportionate to the CENVAT credit, accounting for 2.5% depreciation per quarter from 2004 to 2010. The response confirmed that reversing the CENVAT credit after deducting 2.5% per quarter is the correct approach to offset the Central Excise Duty. (AI Summary)
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