Cenvat credit on stationery or bill of xerox copy provided by vendro, Service Tax

[vipin kumar]

Dear sir

please suggest me can we take the cenvat credit on stationey bill / bill of xerox copy provided by vendor or all amount should be booked in stationery account code.

Thanks & Regards

Vipin Kumar

Posts / Replies

[JSW CEMENT LIMITED]

You can not avail cenvat credit on stationaries. Refer Cenvat credit rules.

[GOKARNESAN.S SUBRAMANIAN]

Mr. Vipin Kumar

You can take the duty paid on stationery if you prove that the usage of such stationery has nexus with the business of manufacture of finished goods in your factory. For example, computerised excise invoices, delivery challans etc are used for clearance of excisable goods and hence, the same has nexus with manufacturing of goods.

The above view is supported by (a) amended Definition of inputs from 1.4.2011 and (b) Board clarification in circular number 943/4/2011 CX dated 29.4 .2011.

As per definition of inputs from 1.4.2011, credit is eligible for all goods used in the factory which has nexus with the manufacture of goods, except goods covered under exclusion clause.

CBEC, vide Circular No. 943/4/2011-CX., dated 29-4-2011 (F.No. 354/73/2011-TRU) has given the following clarification.

How is the “no relationship whatsoever with the manufacture of a final product” to be determined?

Credit of all goods used in the factory is allowed except in so far as it is specifically denied. The expression “no relationship whatsoever with the manufacture of a final product” must be interpreted and applied strictly and not loosely. The expression does not include any goods used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not. Only credit of goods used in the factory but having absolutely no relationship with the manufacture of final product is not allowed. Goods such as furniture and stationary used in an office within the factory are goods used in the factory and are used in relation to the manufacturing business and hence the credit of same is allowed.

 

If you prove that the stationery used in an office has nexus with manufacture, you are eligible for credit. On the other hand, if usage of stationery for other purpose which has no nexus with manufacture, credit not eligible.

With regard to invoice issued for taking xerox copy, no Excise duty is payable by the vendor since the xerox activity does not amount to manufacture and hence, the question of taking credit does not arise.

S. Gokarnesan

Advocate, Chennai

98400 87349

mail: s.gokarnesan@gmail.com

[vipin kumar]

Dear sir

Thanks for suggestion. this is very vluable for me.

Vipin Kumar

[bhart b sharma]

what is your output service?

in case, it is necessary/essential input for providing the said output, definitely you are entitled to take cenvat credit of such input