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Notification No. 01/2014-CENT dt. 08-01-2014

CENVAT Credit (First Amendment) Rules, 2014

[TO BE PUBLISHED IN THE GAZETTE OF INDIA,
EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)

Notification No. 01/2014-Central Excise (N.T.)
New Delhi, the 8^th January, 2014
18, Pausha, 1935 Saka

G.S.R. (E).- In exercise of the powers conferred by section 37 of the Central Excise Act, 1944 (1 of 1944) and section 94 of the Finance Act, 1994 (32 of 1994), the Central Government hereby makes the following rules further to amend the CENVAT Credit Rules, 2004, namely:-

1.   (1) These rules may be called the CENVAT Credit (First Amendment) Rules, 2014.
      (2) They shall come into force on the date of their publication in the Official Gazette.

2.         In rule 3 of the CENVAT Credit Rules, 2004, -
(i) the Explanation occurring after the proviso to sub-rule (5B) shall be omitted;
(ii) in sub-rule (5C), after the words “production of said goods”, the words “and the CENVAT credit taken on input services used in or in relation to the manufacture or production of said goods” shall be inserted;
(iii) after sub-rule (5C), the following explanations shall be inserted, namely: -

“Explanation 1.-  The amount payable under sub-rules (5), (5A), (5B) and (5C), unless specified otherwise, shall be paid by the manufacturer of goods or the provider of output service by debiting the CENVAT credit or otherwise on or before the 5th day of the following month except for the month of March, where such payment shall be made on or before the 31st day of the month of March.
Explanation 2.- If the manufacturer of goods or the provider of output service fails to pay the amount payable under sub-rules (5), (5A), (5B) and (5C), it shall be recovered, in the manner as provided in rule 14, for recovery of CENVAT credit wrongly taken and utilised.”

F. No. 267/126/2011-CX.8
(Pankaj Jain)
Under Secretary to the Government of India

Note.- The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), dated the 10^th September, 2004, vide Notification No. 23/2004 – Central Excise (N.T.) dated the 10^th September, 2004, vide number G.S.R. 600(E), dated the 10^thSeptember, 2004 and last amended vide Notification No. 18/2013-Central Excise (N.T.) dated the 31^stDecember, 2013 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 808 (E), dated the 31^st December, 2013.

Opinion

This notification seeks to amend the cenvat credit rules,2004 to be now called the CENVAT Credit (First Amendment) Rules, 2014 and the same will be immediate implemented. The following amendments have been made in the said Rules:-

1.    the Explanation occurring after the proviso to sub-rule (5B) shall be omitted; this has been done as explanation 2 has been added.
2.    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 and the CENVAT credit taken on input services used in or in relation to the manufacture or production of said goods shall be reversed. Earlier, reversal with respect to input services was not required.

3.    after sub-rule (5C), the following explanations shall be inserted, namely:

(a)   “Explanation 1.-  The amount payable under sub-rules (5), (5A), (5B) and (5C), unless specified otherwise, shall be paid by the manufacturer of goods or the provider of output service by debiting the CENVAT credit or otherwise on or before the 5th day of the following month except for the month of March, where such payment shall be made on or before the 31st day of the month of March. The effect of this is that the credit reversal will be treated as excise duty payment and would be payable by the 5^th of next month and by 31^st in the month of March.

(b) Explanation 2.- If the manufacturer of goods or the provider of output service fails to pay the amount payable under sub-rules (5), (5A), (5B) and (5C), it shall be recovered, in the manner as provided in rule 14, for recovery of CENVAT credit wrongly taken and utilised.” Earlier, 5C was not mentioned and now the same is rectified.