Amendment in Cenvat Credit Rules, 2004 — CENVAT Credit (Amendment) Rules, 2015

NOTIFICATION No. 06/2015-Cen­tral Excise (N.T.)

New Del­hi, the 1^st March, 2015

G.S.R. (E).- In exer­cise of the pow­ers con­ferred by sec­tion 37 of the Cen­tral Excise Act, 1944 (1 of 1944) and sec­tion 94 of the Finance Act, 1994 (32 of 1994), the Cen­tral Gov­ern­ment here­by makes the fol­low­ing rules fur­ther to amend the CENVAT Cred­it Rules, 2004, namely : -

(1) These rules may be called the CENVAT Cred­it (Amend­ment) Rules, 2015.

(2) Save as oth­er­wise pro­vid­ed in these rules, they shall come into force on the 1¹ day of March, 2015.

In the CENVAT Cred­it Rules, 2004 (here­inafter referred to as the said rules), in rule 4, -

1. in sub-rule (1), -

(i) after the words “the provider of out­put ser­vice” , occur­ring at the end and before the first pro­vi­so, the words “or in the premis­es of the job work­er, in case goods are sent direct­ly to the job work­er on the direc­tion of the man­u­fac­tur­er or the provider of out­put ser­vice, as the case may be,” shall be inserted;

(ii) in the third pro­vi­so, for the words “six months”, the words “one year” shall be substituted;

2. in sub-rule (2), in clause (a), after the words “for cap­tive use with­in the fac­to­ry,” the words “or in the premis­es of the job work­er, in case cap­i­tal goods are sent direct­ly to the job work­er on the direc­tion of the man­u­fac­tur­er or the provider of out­put ser­vice, as the case may be,” shall be inserted
3. in sub-rule (5), for clause (a), the fol­low­ing clause shall be sub­sti­tut­ed, namely: -

“(a) (i) The CENVAT cred­it on inputs shall be allowed even if any inputs as such or after being par­tial­ly processed are sent to a job work­er and from there sub­se­quent­ly sent to anoth­er job work­er and like­wise, for fur­ther pro­cess­ing, test­ing, repair­ing, re-con­di­tion­ing or for the man­u­fac­ture of inter­me­di­ate goods nec­es­sary for the man­u­fac­ture of final prod­ucts or any oth­er pur­pose, and it is estab­lished from the records, chal I ans or mem­os or any oth­er doc­u­ment pro­duced by the man­u­fac­tur­er or the provider of out­put ser­vice tak­ing the CENVAT cred­it that the inputs or the prod­ucts pro­duced there­from are received back by the man­u­fac­tur­er or the provider of out­put ser­vice, as the case may be, with­in one hun­dred and eighty days of their being sent from the fac­to­ry or premis­es of the provider of out­put ser­vice, as the case may be:

Pro­vid­ed that cred­it shall also be allowed even if any inputs are direct­ly sent to a job work­er with­out their being first brought to the premis­es of the man­u­fac­tur­er or the provider of out­put ser­vice, as the case may be, and in such a case, the peri­od of one hun­dred and eighty days shall be count­ed from the date of receipt of the inputs by the job worker;

2. the CENVAT cred­it on cap­i­tal goods shall be allowed even if any cap­i­tal goods as such are sent to a job work­er for fur­ther pro­cess­ing, test­ing, repair, re-con­di­tion­ing or for the man­u­fac­ture of inter­me­di­ate goods nec­es­sary for the man­u­fac­ture of final prod­ucts or any oth­er pur­pose, and it is estab­lished from the records, chal­lans or mem­os or any oth­er doc­u­ment pro­duced by the man­u­fac­tur­er or the provider of out­put ser­vice tak­ing the CENVAT cred­it that the cap­i­tal goods are received back by the man­u­fac­tur­er or the provider of out­put ser­vice, as the case may be, with­in two years of their being so sent:

Pro­vid­ed that cred­it shall be allowed even if any cap­i­tal goods are direct­ly sent to a job work­er with­out their being first brought to the premis­es of the man­u­fac­tur­er or the provider of out­put ser­vice, as the case may be, and in such a case, the peri­od of two years shall be count­ed from the date of receipt of the cap­i­tal goods by the job worker;

3. if the inputs or cap­i­tal goods, as the case may be, are not received back with­in the time spec­i­fied under sub-clause (i) or (ii), as the case may be, by the man­u­fac­tur­er or the provider of out­put ser­vice, the man­u­fac­tur­er or the provider of out­put ser­vice shall pay an amount equiv­a­lent to the CENVAT cred­it attrib­ut­able to the inputs or cap­i­tal goods, as the case may be, by deb­it­ing the CENVAT cred­it or oth­er­wise, but the man­u­fac­tur­er or the provider of out­put ser­vice may take the CENVAT cred­it again when the inputs or cap­i­tal goods, as the case may be, are received back in the fac­to­ry or in the premis­es of the provider of out­put service.”;

(d) in sub-rule (7), -

(i) for the first, sec­ond and third pro­vi­sos, the fol­low­ing pro­vi­sos shall be sub­sti­tut­ed, with effect from the 1^st day of April 2015, namely:-

“Pro­vid­ed that in respect of input ser­vice where whole or part of the ser­vice tax is liable to be paid by the recip­i­ent of ser­vice, cred­it of ser­vice tax payable by the ser­vice recip­i­ent shall be allowed after such ser­vice tax is paid:”

“Pro­vid­ed fur­ther that in case the pay­ment of the val­ue of input ser­vice and the ser­vice tax paid or payable as indi­cat­ed in the invoice, bill or, as the case may be, chal­lan referred to in rule 9 is not made with­in three months of the date of the invoice, bill or, as the case may be, chal­lan, the man­u­fac­tur­er or the ser­vice provider who has tak­en cred­it on such input ser­vice, shall pay an amount equal to the CENVAT cred­it availed on such input ser­vice, except an amount equal to the CENVAT cred­it of the tax that is paid by the man­u­fac­tur­er or the ser­vice provider as reci pi ent of ser­vice, and in case the said pay­ment is made, the man­u­fac­tur­er or out­put ser­vice provider, as the case may be, shall be enti­tled to take the cred­it of the amount equiv­a­lent to the CENVAT cred­it paid ear­li­er sub­ject to the oth­er pro­vi­sions of these rules:”

2. in the sixth pro­vi­so, for the words “six months”, the words “one year” shall be substituted;
3. in the Expla­na­tions I and II, for the words “sub-rule”, the word “rule” shall be substituted.

3. In the said rules, in rule 5, in Expla­na­tion 1, after clause (1), the fol­low­ing clause shall

be insert­ed, namely:-

“(1A) “export goods” means any goods which are to be tak­en out of India to a place out­side India”.

4. In the said rules, in rule 6, in sub-rule (1), after the pro­vi­so, the following

Expla­na­tions shal I be insert­ed, namely: -

“Expla­na­tion 1. — For the pur­pos­es of this rule, exempt­ed goods or final prod­ucts as defined in claus­es (d) and (h) of rule 2 shall include non-excis­able goods cleared for a con­sid­er­a­tion from the factory.

Expla­na­tion 2. — Val­ue of non-excis­able goods for the pur­pos­es of this rule, shall be the invoice val­ue and where such invoice val­ue is not avail­able, such val­ue shall be deter­mined by using rea­son­able means con­sis­tent with the prin­ci­ples of val­u­a­tion con­tained in the Excise Act and the rules made thereunder.”

5. In the said rules, in rule 9, in sub-rule (4), the fol­low­ing pro­vi­so shall be insert­ed at the end, namely:-

“Pro­vid­ed that pro­vi­sions of this sub-rule shall apply mutatis mutan­dis to an importer who issues an invoice on which CENVAT cred­it can be taken.”.

6. In the said rules, in rule 12AAA, -

1. after the words “restric­tions on a man­u­fac­tur­er” , the words “reg­is­tered importer,” shall be inserted.
2. after the words “sus­pen­sion of reg­is­tra­tion in case of , the words “an importer or” shalI be inserted.

7. In the said rules, for rule 14, the fol­low­ing rule shall be sub­sti­tut­ed, namely:-

“14. Recov­ery of CENVAT cred­it wrong­ly tak­en or erro­neous­ly refunded. -

(1) (i) Where the CENVAT cred­it has been tak­en wrong­ly but not utilised, the same shall be recov­ered from the man­u­fac­tur­er or the provider of out­put ser­vice, as the case may be, and the pro­vi­sions of sec­tion 11A of the Excise Act or sec­tion 73 of the Finance Act, 1994 (32 of 1994), as the case may be, shall applymutatis mutan­dis for effect­ing such recoveries;

(ii) Where the CENVAT cred­it has been tak­en and utilised wrong­ly or has been erro­neous­ly refund­ed, the same shall be recov­ered along with inter­est from the man­u­fac­tur­er or the provider of out­put ser­vice, as the case may be, and the pro­vi­sions of sec­tions 11A and 11AA of the Excise Act or sec­tions 73 and 75 of the Finance Act, 1994, as the case may be, shall apply mutatis mutan­dis for effect­ing such recoveries.