Obligation of the manufacturer of dutiable and exempted goods and provider of taxable and exempted services (Rule 6 of the CCR): - Central Excise Practice Manual (OLD) - Central Excise

9. Obligation of the manufacturer of dutiable and exempted goods and provider of taxable and exempted services (Rule 6 of the CCR): If Cenvat credit is availed on the inputs or input services, which are used in the manufacture of both dutiable and exempted goods or rendering of both dutiable and exempted services, separate accounts of receipt, consumption and inventory of such inputs or input services are to be maintained. In such cases, Cenvat credit is to be taken only on that quantity of the inputs and input services used in the manufacture of dutiable goods/provision of services. If the manufacturer/ service provider does not maintain separate accounts, the following two options are available: (a) In case of manufacturer, he has to pay an amount equal to 10% of the value of the exempted goods. The service provider has to pay an amount equal to 8% of the value of the exempted services; or (b) The manufacturer/service provider shall pay an amount equivalent to the Cenvat credit attributable to the inputs and input services subject to the conditions and procedures prescribed in Rule 6 (3A) of the CCR. The conditions relating to maintenance of separate accounts or payment of 10% of the value prescribed under Rules 6 (1), 6 (2) and 6 (3) of the CCR shall not apply for exempted goods cleared to the following categories: (i) SEZ Unit; (ii) 100% EOU; (iii) EHTP, STPI unit; (iv) United Nations or an International Organization for their official use or supplied to projects listed under Notification No.108/95-C.E; (v) for export under bond under Rule 19 of the CER; (vi) gold or silver arising in the course of manufacture of copper or zinc by smelting; or (vii) all goods which are exempt from the basic duties of Customs and the Additional duty (CVD) when imported into India and supplied against International competitive bidding in terms of Notification No. 6/2006-C.E dated 1.3.2006.