Limitation of six months for availing CENVAT Credit not applicable in case of Re-availment

CBEC has issued Cir­cu­lar No. 990/14/2014-CX‑8 dat­ed 19^th Novem­ber, 2014 to clar­i­fy that the lim­i­ta­tion of six months on avail­ment of CENVAT Cred­it insert­ed by Noti­fi­ca­tion No. 21/2014-CE (NT) is only applic­a­ble on cred­it tak­en for the first time with­in six months of the issue of the Invoice.

For instance an invoice is issued on 01/Sep/2014 & CENVAT Cred­it is availed on 01/Sep/2014 as per rule 4(7) of CCR, 2004. How­ev­er, Pay­ment to ven­dor is not made with­in 90 days i.e. till the end of Decem­ber. There­fore, CENVAT Cred­it availed is required to be reversed on or before the com­ple­tion of 90 days. There­after, pay­ment to ven­dor is made in Sep­tem­ber 2015. Now, the issue aris­es as to whether CENVAT Cred­it can be re-availed as per 3^rd pro­vi­so to rule 4(7) of CCR, 2004 i.e. after the com­ple­tion of six months. Now, CBEC, through this cir­cu­lar has clar­i­fied that it can be re-availed in Sep­tem­ber 2015 & there is no lim­i­ta­tion on re-avail­ment of such CENVAT Credit.

There­fore, re-cred­it tak­en in the fol­low­ing sit­u­a­tions are out­side the ambit of afore­men­tioned Notification:

1. where as per 3^rdpro­vi­so to rule 4(7) of CCR, 2004, pay­ment of val­ue of ser­vice and ser­vice tax payable is not made with­in three months, CENVAT Cred­it availed is required to be reversed back only to re-avail such CENVAT Cred­it after afore­said pay­ments are made.
2. where as per Rule 3(5B) of CCR, 2004, CENVAT Cred­it on inputs/ Cap­i­tal goods are re-cred­it­ed after being reversed owing to writ­ing off such inputs/capital goods before being put to use.
3. where as per Rule 4(5)(a) of CCR, 2004, when the inputs sent to job work­ers are not received back with­in 180 days, CENVAT Cred­it availed on such inputs are reversed only to re-avail such CENVAT after such inputs are received back by the man­u­fac­tur­er or ser­vice provider.