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Finished goods burnt by fire- reg

Central Excise - Started By: - vinay wakde - Dated:- 13-2-2016 Last Replied Date:- 17-2-2016 - We are manufacturer finished goods namely Direct Reduced Iron (DRI) i.e. Sponge Iron (CH No. 7203 10 00). There was fire in our finished goods stock yard and we have submitted an application for remission of duty under Rule 21. We have now received a letter from the Department to reverse the CENVAT credit involved on duty paid inputs contained in finished goods with interest and brief report from us ab .....

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- The Reply = Sir, As per rule 3 (5C) of Cenvat Credit rules, 2004 Where on any goods manufactured or produced by an assessee, the payment of duty is ordered to be remitted under rule 21 of the Central Excise Rules, 2002, the CENVAT credit taken on the inputs used in the manufacture or production of said goods 3and the CENVAT credit taken on input services used in or in relation to the manufacture or production of said goods shall be reversed. As per Explanation-1 of the above mentioned rule the .....

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ufacture of destroyed goods by debiting your cenvat credit account. If the same is paid beyond the date specified in the explanation then it will attract interest. Interest is to be paid in cash only. - Reply By MADAN RAHEJA - The Reply = Cenvat credit of input services can be utilized for payment of excise duty on goods manufactured by you and ipso facto for reversal of credit on inputs contained in finished goods burnt in fire for claiming remission of duty. There is no restriction for cross u .....

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nd not before. Generally, the reversal at the time of destruction of the remitted goods ( after permission.But in your case the goods already destroyed in fire and to process your application , the Department is asking for reversal of credit and also to submit the steps taken to avoid/prevent the accidents ( Ex: Fire accident)I feel,the intention of the Department behind asking for the steps taken is to ascertain whether the accident is happened beyond your control or otherwise to consider your .....

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destroyed goods.RegardsSuryanarayana - Reply By KASTURI SETHI - The Reply = Sh.Vinay Wakde Ji, The advice given by both experts is fool-proof to the core. I would like to just add that if insurance Co.'s report is in your favour, nothing to panic; normally, the department remits the duty involved in the finished goods destroyed in fire. Duty element is not to be claimed in the insurance claim from the insurance Co. - Reply By YAGAY AND SUN - The Reply = Notification No. 33/2007-Central Excis .....

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