Cenvat credit on additional excise duty or Rs.15/ltr

[Yatin Bhopi]

Sir

We are manufacturer and product PT is our Raw Material falling under chapter heading 27101219 which attract excise duty @ 14% + Rs. 15/ltr. Please let me know whether Cenvat credit is available on Rs. 15/ltr?

[Surender Gupta]

What is excluded form the definition of ‘input’ is “Motor Spirits commonly known as petrol” not all the motor spirits.

See: 2013 (1) TMI 324 - CESTAT, NEW DELHI - BALKRISHNA INDUSTRIES Versus COMMISSIONER OF CENTRAL EXCISE, JAIPUR-I

and 2005 (2) TMI 296 - CESTAT, NEW DELHI - TUFTWEEN PETROCHEMICALS Versus COMMISSIONER OF CENTRAL EXCISE, MEERUT

 

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If you are eligible for Cenvat Credit then there is no difference between 14%  and/or Rs. 15/ltr.. It is just one mode of calculation of duty. The rate of duty be it a mixture of ad valorem or volume based nothing to do with cenvat credit unless and until specifically addressed in the Rules.

 

What is excluded form the definition of ‘input’ is “Motor Spirits commonly known as petrol” not all the motor spirits

AI Summary

Cenvat credit entitlement extends to specific and ad valorem duty components where the input is not excluded by definition. Cenvat credit depends on whether the material qualifies as an 'input'; the exclusion expressly covers 'Motor Spirits commonly known as petrol' and not all motor spirits. If an input is eligible, the mode of duty - ad valorem, specific per unit, or a mixture - does not prevent Cenvat credit unless the Rules explicitly disallow credit on that duty component.