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TMI BlogRegarding clarification on issues relating to CENVAT Credit Rules 2004X X X X Extracts X X X X X X X X Extracts X X X X ..... ed along with the Budget 2011 announcements vide Notification 3/2011-CE (NT) dt 1.3.2011. A few changes were further effected vide Notification 13/2011-CE (NT) dt 31.3.2011. On a few issues trade has requested for clarity. Accordingly the following clarifications are presented issue wise in a tabular format. S.No. Issue Clarification 1 Can credit of capital goods be availed of when used in manufacture of dutiable goods on which benefit under Notification 1/2011- CE is availed or in provision of a service whose part of value is exempted on the condition that no credit of inputs and input services is taken? As per Rule 6(4) no credit can be availed on capital goods used exclusively in manufact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods used in the factory but having absolutely no relationship with the manufacture of final product is not allowed. Goods such as furniture and stationary used in an office within the factory are goods used in the factory and are used in relation to the manufacturing business and hence the credit of same is allowed. 4 Is the credit of input services used for repair or renovation of factory or office available? Credit of input services used for repair or renovation of factory or office is allowed. Services used in relation to renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises, are specifically provided for in the inclusive part of the definition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rinciples should be used. 9 Are the taxes and year end discounts to be included in the sale price and cost of goods sold while calculating the value of trading? Generally accepted accounting principles need to be followed in this regard. All taxes for which set off or credit is available or are refundable/ refunded may not be included. Discounts are to be included. 10 Does the expression in or in relation used in Rule 6 override the definition of input under Rule 2(k) for determining the eligibility of Cenvat credit? The definition of input is given in Rule 2(k) and Rule 6 only intends to segregate the credits of inputs used towards dutiable goods and exempted goods. While applying Rule 6, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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