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How to deal with Balances 2% & 1% cess on 01.03.2015, Central Excise |
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How to deal with Balances 2% & 1% cess on 01.03.2015 |
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How to deal with Balances of 2% Primary Education Cess of Central Excise & 1% Secondary & Higher Education Cess of Central Excise, lying in CENVAT Credit Register on 01.03.2015 ? Posts / Replies Showing Replies 1 to 4 of 4 Records Page: 1
please refer to the minutes of the tariff conference Issue: Exemption from levy of Education Cess and Secondary & Higher Education Cess has been provided w.e.f. 01.03.2015 vide notification no. 14/2015-CE & 15/2015-CE both dated 01.03.2015, Sub-rule 7(b) of Rule 3 of CENVAT Credit Rules, 2004, specifies that CENVAT credit of specified duties shall be utilized for payment of those specified duties only. CENVAT Credit of Education Cess and Secondary & Higher Education Cess can be utilized only for payment of Education Cess and Secondary & Higher Education Cess, respectively. Consequent upon grant of exemption there is issue of utilization of the accumulated credit of the past. It is suggested that an amendment to sub-rule 7(b) of Rule 3 of CENVAT Credit Rules, 2004 may be made to allow the utilization of balance CENVAT Credit of Education Cess and Secondary & Higher Education Cess towards payment of either duty of excise or Service Tax. Discussion & Decision The conference after discussion and briefing from the officers from the Board noted that it was Government’s conscious policy decision to withdraw the Education Cess and Secondary & Higher Education Cess. It is a policy decision to not allow utilization of accumulated credit of education cess and secondary and higher education cess after these Cesses have been phased out. As these Cesses have been phased out and no new liability to pay such Cess arises, no vested right can be said to exist in relation to the accumulated credit of the past. The rule and notifications as they exist need to be followed and do not need any amendment.
The answer given by Sri Himasu Ji is Crystal clear. Thanks Sri Himansu ji.
I endorse the views of Shri Himanshu Sha
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