Surrender of certificate by existing unit

[Lakhmi Khilrani]

A unit with plant & machinery on which cenvat credit taken four years back is running into losses and wish to close down the unit and surrender excise registration certificate. Quarry is whether the unit will have to pay excise duty on sale of machinery though for production its sale is less than 150 Lacs and company is no more taking input credit on raw material? Whether the company will have to pay excise duty on raw material laying in stock as on the date of surrender of registration?

AI Summary

Company Closing Unit: Excise Duty on Machinery Sale Requires CENVAT Credit Reversal per Amended CENVAT Credit Rules, 2004. A company facing losses wishes to close its unit and surrender its excise registration certificate. The main concern is whether excise duty is payable on the sale of machinery and raw materials. Responses indicate that for capital goods, CENVAT credit must be reversed based on depreciation or transaction value, whichever is higher, as per the amended CENVAT Credit Rules, 2004. For raw materials, if the company has opted for exemption under notification 8/2003 CE, reversal of credit is not required unless it was not done at the start of the fiscal year.