Availment of Cenvat credit

[mrk fast]

X company received inputs from Y company[100%EOU]and took cenvat credit of CVD [BED-14%]and Education Cess and SHE Cess. But some of the manufacturers say that X company can avail Cenvat credit as per the formula mentioned in Rule 3(7) of the  Cenvat Credit Rules i.e X multiplied by [(1+BCD/400) Multiplied by (CVD/100)] and no credit on Education cess or SHE cess is allowed as Cenvat credit eventhough the 100% EOU has paid the same. I request the members of the forum to give their opinion on this matter.

AI Summary

Dispute Over Cenvat Credit Eligibility for Education and SHE Cess Under Rule 3(7) of Cenvat Credit Rules X company, receiving inputs from Y company (a 100% EOU), took Cenvat credit for CVD and related cesses. The issue raised was whether X company can avail Cenvat credit for education cess and SHE cess as per Rule 3(7) of the Cenvat Credit Rules, which suggests a specific formula. One response argued that X can claim credit for education cess without using the formula, while another highlighted tribunal decisions supporting full credit for education cess and higher education cess, despite the rule's formula.