Thus, by way of this amendment the time limit for availing Cenvat credit on inputs and input services has been curtailed to six months from the date of issue of the document such as invoice, bill of entry, challan, supplementary invoice, etc.
| Quick Points to ponder :- a) Department may hold view that going by plain interpretation of the notification, the cenvat of input and input services prior to 6 Months from 1.9.2014 shall lapse if not availed by 31.8.2014 b) Whether the same notification would have a impact on ongoing litigations where the demands is upheld by the appellate authority. c) A very clear scrutiny is required to be conducted by all the assessees in regard to the cenvat availed by them and cenvat not availed due to several reasons possible. d) This amendment is not applicable on capital goods. (Hence No Limit there) |
Since this amendment will be effective from 1-9-2014, any Cenvat credit on inputs and input services which has not been availed within six months from the date of issue of invoice will lapse on 1-9-2014. Such Cenvat credit cannot be availed even if those are eligible inputs and input services.
In light of the above, it is advisable that all eligible inputs and input services on which Cenvat credit has not been availed so far shall be identified / verified and Cenvat credit shall be availed before 1-9-2014.
This is to ensure that credit on the eligible inputs and input services does not lapse. It may be noted that, in the absence of any specific clarification with regard to the applicability of time limit for the credit not availed upto 1-9-2014, the Department may take a view that the time limit will be applicable to invoices issued prior to 1-9-2014 also, if the Cenvat credit is not availed before 1-9-2014. Accordingly, disputes may be raised on the eligibility of Cenvat credit if the same is availed after the expiry of six months from the date of invoice, even if invoices were received prior to 1-9-2014.
Further, disputes on applicability of time limit may also arise in cases of pending litigations on eligibility of the Cenvat credit and also in cases where alternative argument of eligibility of Cenvat will arise, in case the demand ultimately succeeds. It is advisable to evaluate these situations also and take appropriate action so that the credit is not missed on account of delay once the cases are decided.
Post 1-9-2014, you may ensure that the credit is taken well within the prescribed period of six months.
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About the Author:
CA Ankit Gulgulia (Jain)
Author is Practicing Chartered Accountant in New Delhi/NCR and specializing in Indirect Taxes, Corporate Laws and Transfer Pricing. He can be reached at ankitgulgulia@gmail.com or at +91-9811653975
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