Cenvat Credit on spare parts ?

[Ajay shah]

Dear Sir,

We have a few machines in our factory. Whenever there is some breakdown we procure spare parts for the same.

My query is :    is the cenvat credit of the spare to be treated as capital goods credit and taken 50/50  or can I simply take 100% credit ?

 

AI Summary

Cenvat Credit on Spare Parts: 50/50 Split Over Two Years Required Under CENVAT Credit Rules, 2004 A query was raised regarding the treatment of Cenvat credit for spare parts used in factory machinery. The question was whether the credit should be treated as capital goods credit, requiring a 50/50 split over two financial years, or if 100% credit could be taken immediately. Respondents clarified that under the CENVAT Credit Rules, 2004, credit on spare parts, components, and accessories is treated as capital goods credit. Therefore, only 50% of the credit can be availed in the year of receipt, with the remaining 50% available in the subsequent financial year after installation.