TMI BlogTaking Cenvat Credit on Purchase of Gen set - reg.X X X X Extracts X X X X X X X X Extracts X X X X ..... Dear sir, We have planned to purchase a Diesel Generator set for our Paper Industry. Can we take Cenvat Credit on the Purchase of Generator?. Is there is any dispute in taking Credit. Kindly reply. - Reply By raj kumar shukla - The Reply = Most probably the gen sets are falling under chapter 85 of the central excise tariff therefore these are eligible for cenvat credit provided it is us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the factory - Reply By Vivek Harsh - The Reply = As per Rule 2(a) of CCR, 2004, Cenvat credit of generator used outside factory for generation of electricity for captive consumption is permissible. - Reply By Pradeep Khatri - The Reply = CENVAT credit on Genset will be available to you since it is being used for generation of electricity which inturn will be used in manufacturing o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f final products. You will have to avail the CENVAT credit to the extent of 50% in the first financial year and remaining 50% on the next financial year but after installation. - Reply By Naveed S - The Reply = Yes, credit on Gen Set is surely available as mentioned above. However, to make U understand about the availability of credit on capital goods, I reproduce below an extract of a widely k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nown Judgment in the case of Central Excise, Coimbatore Others v. Jawahar Mills Ltd., wherein the Supreme Court observed as under : "4. The definition of "capital goods" is very wide. Capital goods can be machines, machinery, plant, equipment, apparatus, tools or appliances. Any of these goods if used for producing or processing of any goods or for bringing about any change in any substa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce for the manufacture of final product would be "capital goods", and, therefore, qualify for availing MODVAT credit. Per clause (b), the components, spare parts and accessories of the goods mentioned in clause (a) used for the purposes enumerated therein would also be "capital goods" and qualify for MODVAT credit entitlement. Clause (c) makes moulds and dies, generating sets and weighbridges use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the factory of the manufacturers as capital goods and thus qualify for availing MODVAT credit. The goods enumerated in clause (c) need not be used for producing the final product or used in the process of any goods for the manufacture of final product or used for bringing about any change in any substance for the manufacture of final product and the only requirement is that the same should be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used in the factory of the manufacturer. Thus, it can be seen that the language used in the Explanation is very liberal." Hope now the definition of Capital goods is clear and u can yourself decide about its availability. - Taking Cenvat Credit on Purchase of Gen set - reg. - Query Started By: - gowri shankar Dated:- 22-2-2012 Central Excise - Got 4 Replies - Central Excise - Discussion Fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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