We are a Export Oriented Unit (EoU). We have bought some capital good on duty payment and taken Cenvat Credit. We buy most of the inputs without duty payment against CT3. But, we have Cenvat Credit accumulating due to service tax on input services and clearance of our export goods without duty payment. Can we claim refund of the accumulated credit under Rule 5 of Cenvat Credit Rules, 2004?
Refund of Cenvat Credit under Rule 5 of the Cenvat Credit Rules, 2004 is limited to accumulated credit of duty/tax paid on inputs/input services. Refund of capital goods credit is not envisaged in the said Rule 5.
We are working under SSI exemption notification no. 8/2003 dated March 1, 2003. We are making dutiable, non-dutiable and non-excisable items. Are we required to count all the clearances for computing the aggregate limit of Rs 4 crore?
You are required to count all the clearances of excisable goods — whether subject to ‘nil’ duty or not (except, those specifically excluded) — but, you need not count the clearance of non-excisable goods while working out the aggregate limit of Rs 4 crore.
Are we required to pay CST/VAT on sales from Domestic Tariff Area (DTA) to Special Economic Zone (SEZ)?
You need not pay Central Sales Tax (CST) which is exempt subject to certain documentation requirements. But, for Value Added Tax (VAT), you have to refer to the law of the State in question. Some States exempt VAT on DTA to SEZ sales, some grant a refund and some states grant neither exemption nor refund.
For certain services that we receive (e.g. goods transport agency, services received from abroad), we are the persons liable for payment of service tax. When we discharge service tax liability in such cases, can we take Cenvat Credit of the same?
If you are a manufacturer or service provider and otherwise eligible to take Cenvat Credit, there is no question of denying any Credit of service tax paid on ‘input services’. The question to ask is not who has discharged the tax liability but whether the services happen to be ‘input services’ as defined in the Cenvat Credit Rules, 2004. In this connection, you may refer to CBEC Circular no. 345/1/2008-TRU dated June 27, 2008.
We had applied for advance authorisation under Para 4.7 of the Handbook of Procedures, Vol. 1 (HB-1). The Norms Committee has fixed norms far lesser than our requirement. Is there any recourse against the decision?
You can represent against the decision of the Norms Committee but you have to do it within 4 months of the communication of the decision. For Project supplies, the time limit is one year. Please see Para 4.7.5 of HB-1.
Under Advance Authorisation, can we import HR coil, a restricted item?
Yes. Only prohibited items and canalized items (without ‘NOC’) are not allowed under Advance Authorisation. Please see Para 4.1.13 of Foreign Trade Policy 2004-09.