sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
Latest Circulars »
 Results of Underwriting Auctions Conducted on May 24, 2018
 RBI to conduct 7-day Variable Rate Reverse Repo auction under LAF on May 24, 2018
 Results of OMO purchase auction held on May 17, 2018 and Settlement on May 18, 2018
 Auction of Government of India Dated Securities May 21, 2018
 Auction for Sale (Re-issue) of Government Stock (GS) May 21, 2018
  RBI-Setting up of IFSC Banking Units (IBUs) – Permissible activities
 RBI-Basel III Framework on Liquidity Standards – Net Stable Funding Ratio (NSFR) – Final Guidelines
 RBI imposes penalty on The United Co-operative Bank Ltd., Bagnan Station Road(North), PO- Bagnan, Dist- Howrah, West Bengal
 Auction for Sale (Re-issue) of Government Stock (GS) May 14, 2018
 Auction of Government of India Dated Securities May 14, 2018
 RBI declines to share copies of inspection reports

Liability of interest where CENVAT credit - Central Excise Circular No. 942/03/2011
March, 15th 2011


                                                                                                            Circular No.  942/03/2011-CX

F.No.267/83/2009-CX8 (Pt.I)

 Government of India
Ministry of Finance
Department of Revenue
 (Central Board of Excise & Customs)
 

                                                                                      New Delhi, dated the 14th March, 2011.

To,

All Director Generals,

All Chief Commissioners of Central Excise (including LTU),

All Commissioners of Central Excise (including LTU).

Sir/ Madam,  

Subject: Liability of interest where CENVAT credit was wrongly taken but reversed by assessee before utilization-reg.

         Attention is invited to the Boards Circular No. 897/17/2009-CX dated 03.09.09, wherein it was clarified that in light of clear and unambiguous provisions of Rule 14 of the CENVAT Credit Rules, 2004, the interest shall be recoverable when credit has been wrongly taken, even if it has not been utilized.

2.    References have been received to re-examine the issue in light of judgement of P&H High Court in the case of Ind-Swift Labs. V/s UOI [2009(240)ELT328(P&H)]. The said judgement of P&H High Court held that under provisions of Rule 14 of CENVAT Credit Rules, 2004, interest cannot be claimed from the date of wrong availment of credit. It is required to be paid from the date it is wrongly utlilized.  

3.    The matter has been examined. It is observed that the issue has now been conclusively settled by the Apex Court in the departmental appeal against the above mentioned judgement of P&H High Court. The Apex Court vide its judgement dated 21.02.11 in Civil Appeal No. 1976 of 2011 has set aside the aforesaid order of Honble High Court. The Apex Court has ruled that If the aforesaid provision is read as a whole we find no reason to read the word OR in between the expressions taken or utilized wrongly or has been erroneously refunded as the word AND. On the happening of any of the three circumstances such credit becomes recoverable along with interest. In effect, therefore, the view taken by the Board in circular dated 03.09.09 has now been endorsed by the Apex Court.

4.     Immediate action may be taken to safeguard revenue in light of the judgement of Apex Court.

5.     Trade & Industry as well as field formations may be suitably informed.  

6.     Receipt of this circular may kindly be acknowledged.

7.     Hindi version will follow.

Yours faithfully,

(Amish Kumar Gupta)

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Contact Us

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions