EOU Debonding - Utilisation of Cenvat Credit

[Asked by Guest]

Dear All,

While debonding from EOU, we need to pay the customs duty/Excise duty on the closing stock. for paying the excise duty can we utilise the cenvat/service tax credit accumulated by the EOU unit. pl. provide me the details with rulings in Cenvat & central excise rules.

AI Summary

Cenvat credit utilisation cannot discharge duty on EOU closing stock at debonding; refund or DTA use allowed.
Accumulated Cenvat/service tax credit cannot be adjusted to pay excise duty on closing finished stock at the time of debonding from an EOU. The credit may only be utilised for duty on DTA clearances or claimed as a refund under the Cenvat credit rules. Exit from the EOU scheme requires assessment and payment of duty liabilities, a No Dues Certificate from Customs and Central Excise before final debonding, and allows use of bonds/guarantees to expedite the process.