Cenvat credit reversal: removal of inputs or capital goods triggers repayment obligations and a transaction-value floor.
Removal of inputs or capital goods that have attracted Cenvat credit requires repayment of credit; inputs removed as such demand reversal equal to credit availed, while capital goods removed after use permit a depreciated repayment calculated by prescribed straight-line percentages per quarter with a statutory floor equal to duty leviable on transaction value. Input service credit must be reversed when associated inputs are no longer available for manufacture because input services are eligible only if used in or in relation to manufacture and clearance. Transfers of capital goods to related units may be treated as sales so that invoice value can determine the transaction value floor for reversal. (AI Summary)