TaxTMI 
TaxTMI 
Sir,
Please define sub rule (4) of Rule 4 of Cenvat Credit Rule, 2004. Explain it with an example.
Capital goods depriciation
23 Jan 2013 
1 Reply 
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CENVAT credit on capital goods prevents depreciation on the credited portion of the asset value.
Sub rule (4) of Rule 4 of the Cenvat Credit Rules, 2004 requires that CENVAT credit availed on capital goods be excluded from the capitalised cost for depreciation; when excise duty is claimed as CENVAT credit, depreciation must be computed on the purchase cost exclusive of the credited duty. (AI Summary)
Sub rule (4) of Rule 4 of the Cenvat Credit Rules, 2004 requires that CENVAT credit availed on capital goods be excluded from the capitalised cost for depreciation; when excise duty is claimed as CENVAT credit, depreciation must be computed on the purchase cost exclusive of the credited duty. (AI Summary)