Cenvat credit availability

[Guest]

We (a DTA unit) purchase some materials from an EOU uni. What Cenvat credit will be available to us? Is it as per Rule 3(7) or as per proviso to Rule 3(7)?

Regards

[Jeyaram Krishnasamy Raj]

Yes. Credit has to be taken as per formula prescribed under Rule 3(7) of CCR rules 2004. The formula is X multiplied by(1+BCD/400) multiplied by (CVD/100) where X denotes assessable Value.

AI Summary

Cenvat credit calculation must follow Rule 3(7) formula, adjusting assessable value for basic customs duty and countervailing duty. Cenvat credit for purchases by a DTA unit from an EOU must be computed under the formula in Rule 3(7) of the Cenvat Credit Rules, 2004, which adjusts the assessable value to account for basic customs duty and countervailing duty to determine admissible credit.