Cenvat credit on Bill of Entry & exemption on Edu. Cess & SHE. Cess on CVD.

[Srivatsan Krishnamachari]

Dear Learned Friends,

Your valued clarification is required for the two queries.

Query No.  1

We Import our raw materials and the following  the duties and  Adl. Duty, Edu. Cess & SHE. Cess on CVD, Edu. Cess & SHE. Cess on Cutoms duty are paid by us.

1. Basic Value
2. Customs Duty (BCD)
3. Total of  1+2
4. CVD on Item no.3
5. Edu. Cess on CVD @2%
6. SHE. Cess on CVD @1%
7. Total of item no.2+4+5 + 6
8. Customs Edu. Cess @ 2% on item no.7
9. Customs SHE. Cess @ 1% on item no.7
10. Total of Items 1+2+4+5+6+8+9
11. Adl. Duty @ 4% on item no. 10
12. Total Duty (2+4+5+6+8+9+11)

 

We have been taking Cenvat credit on item no. 4, 5, 6 & 11 i.e. CVD, Edu. Cess & SHE. Cess on CVD and Additional Duty (the prevailing rate is 4%)

This practice is being followed for years together.  Please clarify whether this practice is correct.

 

Query No.  2

The  Customs Notification No. 13/2012 & 14/2012 dtd. 17-03-2012, specifically exempts all the goods falling within the 1^st schedule to the Customs tariff act 1975 (51-1975) when imported to India from Edu. Cess & SHE. Cess  which are leviable there on under sub-section 1 of section 3 of customs tariff act 1975, read with section 91, 93 & 94 of the said finance act.

We need clarification whether this exemptions cover Edu. Cess & SHE. Cess levied on both (CVD+BCD).

 

Thanks & with Regards,

Benarjee  Govada

 

 

 

[Radha Arun]

Customs notification 13 and notification 14 of 2012 exempt all imported goods from the education cesses on CVD only, not on BCD. Accordingly, in your qs 1, items 5 and 6 can be omitted. Item 7 will be the total of 2 and 4. The education cesses on customs duty will be worked out on the value in item 7.

You can take Cenvat credit of CVD and of the 4% additional duty.

[Guest]


We import our Raw Material and paid all duties taxes.

But as per Bill of Entry, customs charge education cess &  Higher edu cess on both BCD & CVD.

please clarrify.

 

 

[Guest]

We import our Raw Material and paid all duties taxes.

But as per Bill of Entry, customs charge education cess &  Higher edu cess on both BCD & CVD.

please clarrify, can we take credit on Edu & S edu cess of CVD ?

[Radha Arun]

Earlier, the education cesses were charged on CVD equal to excise duty, and then charged again on the total customs duty including CVD. Now it is only charged on the total customs duty including CVD.

Hope this clarifies the matter.

AI Summary

Cenvat Credit Clarification: Education & SHE Cess Exemptions Limited to CVD, Not BCD; Customs Notifications 13/2012 & 14/2012 Explained. A discussion on a forum addresses two queries related to Cenvat credit and exemptions on education cess and secondary higher education (SHE) cess on countervailing duty (CVD) and basic customs duty (BCD). The first query seeks confirmation on the correctness of claiming Cenvat credit on CVD, education cess, SHE cess, and additional duty. The second query asks if exemptions under Customs Notifications 13/2012 and 14/2012 apply to education cess and SHE cess on both CVD and BCD. Responses clarify that exemptions apply only to CVD, not BCD, and outline the correct calculation method for duties and cesses.