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TMI BlogCENVAT CREDIT IN CASE OF RETURN OF CONSIGNMENT GOODSX X X X Extracts X X X X X X X X Extracts X X X X ..... CENVAT CREDIT IN CASE OF RETURN OF CONSIGNMENT GOODS X X X X Extracts X X X X X X X X Extracts X X X X ..... NDER A CONSIGNMENT AGREEMENT AND PARTY B SELLS THE GOODS TO PARTY C WHO THEN REJECTS THE GOODS AND RETURNS THE SAME TO PARTY B. CAN PARTY B RESEND THE GOODS BACK TO PARTY A AND REVERSE THE EXCISE DUTY THEREIN ??? IF YES THEN WHAT PROCEDURE IS TO BE FOLLOWED PLEASE REPLY Reply By CS SANJAY MALHOTRA: The Reply: Dear Prashant, Please note that Central Excise Rules & CENVAT Credit Rules are diffe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent and are independently applicable. Rule 16 of Central Excise Rules provides for treating the sales return as "Deemed Input" for the purpose of availing CENVAT & Rule 4 of CENVAT Credit Rules provides the admissibility of CENVAT Credit on Inputs used in the manufacture of final products. • Going by the provisions of Rule 16 of Central Excise Rules, No Time Limit is prescribed under Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 16 of Central Excise Rules 2002 for taking back Sales Return and further Rule 4 of CENVAT Credit Rules for time limit restriction has no correlation with Rule 16 of CER, hence the provisions of Rule 4 of CCR should not come in any way for time limit restriction legally for CENVAT availment. You can take back Sales Returns from your consignment agent and accordingly avail the CENVAT benefit on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... strength of Your Original Excise invoice (Document specified in Rule 9 (1) of CCR 2004 for CENVAT availment). Please do ensure that the Particulars stated on original invoice raised for clearing goods to Consignment agent should match with the sales return goods particulars. Reply By Prashant Agarwal: The Reply: A great help indeed .. Many thanks Sanjay ji Reply By KASTURI SETHI: The Reply: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sh.Sanjay Malhotra Ji, Really par excellence reply. Reply By MARIAPPAN GOVINDARAJAN: The Reply: Very good knowledge enriching information. Reply By CS SANJAY MALHOTRA: The Reply: Thanks to my seniors Mr.Kasturi and Mr. Govindarajan ji. Reply By YAGAY AND SUN: The Reply: Dear All, Please go through the Rule 16 (1) & (2) again meticulously. The query raised is not so simple as answered or a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s it seems. In our view Rule 16 (3) would be applicable and permission from the Principal Commissioner or Commissioner, (as the case may be) would also be required since in this matter there is no manufacturer or factory involved but importer and Rule 16 (1) & (2) says Factory/manufacturing etc. In NCL Secolar Ltd.v CCE 2005 2004 (10) TMI 404 - CESTAT, BANGALORE it was held that procedure under R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule 16 applies only when goods are received in the factory. The procedure does not apply when goods are returned to office outside the factory and dispatched from there. Please check for the sake of right interpretation of Rule 16. Regards, YAGAY and SUN (Management, Business and Indirect Tax Consultants) Reply By Mahir S: The Reply: Sir, The point raised above is legal and correct and nee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds to be understood at the time of return of goods.
However, i assume that the query here is basically related to manufacturing activity and therefore the reply provided by Sanjayji appears to be perfect.
If the query is not related to manufacturing activity, then rule 16 shall not come into picture, as clearly pointed out above by YAGAY AND SUN. X X X X Extracts X X X X X X X X Extracts X X X X
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