Claim of Cenvat Credit on Solar Power System

[Asked by Guest]

Hello...we are the manufacturer of solar photovoltaic power system. The same has been exempt under excise by Notification no. 12/2012 We have paid input tax for purchase raw material. Plz suggest how to take claim of the input tax paid along with the applicable section. Also state relevant case law ,if any 

[YAGAY and SUN]

Please specify the serial number of entry against which your product has been mentioned in the Notification no. 12/2012.

[Vijay kumar]

Hello, it seems your goods are exempted under "non-conventional energy devices or systems specified in List 8" as per sl.no.332 of Notification no. 12/2012 CE dt.17.3.2012. In as much as the exemption is unconditional, you cannot opt to pay duty on the systems manufactured by you and thereby take input credit, in terms of Section 5A of the central Excise Act,1944. In terms of Rule 6 of Cenvat Credit Rule, 2004 credit can be taken only when the final product is dutiable. Hence, there is no way u can claim the input tax incidence borne by you. However, if u are into exports, u can get the rebate of such tax amount by following the procedure prescribed under Nofn.43/2001-CE(NT) r/w Rule 18 of Central Excise Rule, 2002, or r rule 5 of Cenvat Credit Rule, 2004. There is no case law in the matter since it is the basic concept of input credit. For any further clarification, plz mail to [email protected]

Notification no. 12/2012  dt.17.3.2012

Hi..

Here Manufactured  product  is  exempted  and not  inputs  required for  manufacturing. Hence you will  have  to pay duties  on inputs  as  applicable.  If  export is there, you will get refund/rebate of such duty.

 

D. Sayyad

any  more details  email me  - [email protected]

 

AI Summary

Input tax credit cannot be claimed for goods exempt from excise; exported exempt goods may seek rebate procedures.
Manufacture of solar photovoltaic systems exempt from excise prevents the manufacturer from claiming Cenvat credit on inputs because input credit is available only when the final product is dutiable; the manufacturer cannot opt to pay duty on exempt products to claim credit. For exports, the appropriate relief is refund or rebate of duties borne on inputs through prescribed export refund procedures rather than domestic Cenvat credit.