Duty Credit Scrips used to Pay Excise Duty on Domestic Procurement - Is Rule 6(3) of the CCR Applicable?
GOVERNMENT has issued notifications No. 29/2012-CE, 30/2012-CE, 31/2012-CE, 32/2012-CE and 33/2012-CE all dated 9.7.2012 to exempt certain manufactured goods when cleared against the specified duty credit scrip issued to an exporter. The holder of the said scrip, to whom the goods are cleared, is entitled to avail CENVAT credit of duties of excise, against the amount debited in the said scrip as per one of the conditions of the notification.
Now, are these exempted goods or duty paid goods? While reporting the above exemption notifications, DDT 1898- 11.7.2012 had stated, "When they are allowing credit, obviously they consider them duty paid. They should have amended the CENVAT Credit Rules also to clear the position that these goods will not be considered as exempted."
Representations have been received from the trade that such clearances are being treated as clearances of exempted goods and payment of amount under rule 6(3), as applicable, of the CENVAT Credit Rules, 2004 is being demanded. Trade has requested that a clarification be issued that these goods be treated as equivalent of duty paid goods so that such payment of amount under rule 6(3) is not required to be made.
The CBEC observes, “One of the conditions for availing of these exemptions is that duties leviable, but for these exemptions, shall be debited in or on the reverse of said scrip. The scrip holder is also permitted to avail of CENVAT credit of the duties debited in the scrip. In view of these provisions it has been decided that such debit of duty in these scrips shall be treated as payment of duty for the purpose of determining the applicability of rule 6 of the CENVAT Credit Rules, 2004."
And so Board clarifies that in respect of goods cleared availing the benefit of any of notifications no. 29/2012-CE, 30/2012-CE, 31/2012-CE, 32/2012-CE and 33/2012-CE all dated 9th July, 2012, payment of amount under rule 6(3) of the CENVAT Credit Rules, 2004 is not applicable.
Now can the Board decide that debit in the scrip shall be treated as duty payment?
Any way the Good Board has decided and let us hope the field officers will follow the Board decision!
Please also see - 11.7.2012
CBEC Circular No.973/07/2013-CX., Dated: September 4, 2013