about selling of the imported machinery

[MEHUL ASHAR]

Respected Sir,

                         I have purchased an imported machinery in the year 2010-11 & have taken credit of cvd+addl.duty(4%), now I want to sell that machinery to my other unit having same PAN so I have to depriciate the duty at 2.5% quarter to the cvd,so same I have to depriciate to the addl.duty charged at 4% or not.

[YAGAY and SUN]

Total duty on which you had availed the CENVAT credit  need to be charged to depreciation @ 2.5% per quarter.

[Surender Gupta]

 

Yes, only 2.5% is required to depreciate. There is no requirement to consider add. duty separately.

AI Summary

Depreciation of duty credit applies to total duty on which credit was taken when transferring imported machinery between units.
When imported machinery on which CENVAT credit was availed is transferred between units under the same PAN, depreciation must be charged at 2.5% per quarter on the total duty amount on which credit was originally taken; additional duty need not be treated separately.