Circular No. 751/67/2003-CX
30th September, 2003

F.No. 267 /47/2003-CX-8
Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise & Customs

Subject: – Utilisation of credit of AED (GSI) towards payment of Cenvat duty- reg.

I am directed to refer to notification No. 13/2003-CE(NT) dated 1.3.2003 vide which CENVAT Credit Rules, 2002 were amended inter alia to provide for utilization of credit of Additional Duty of Excise leviable under Additional Excise Duty (Goods of Special Importance) Act, 1957{AED(GSI)} for payment of CENVAT duty. Subsequently, Board had issued a circular No. 700/16/2003-CX dated 6thMarch, 2003 stating that the reason for the amendment of CENVAT Credit Rules, 2002 existed even prior to 1.3.2003 by way of deletion of article 272 of Constitution of India. It was clarified that the credit of Additional Excise Duty (GSI) accrued prior to 1.3.2003 can be used for the payment of Cenvat duty.   

2. Consequent to this, Board’s attention has been drawn to availment of credit in the months of April to June 2003 of AED (GSI) by certain manufacturers for the goods received prior to 1.3.2003. The credit has been availed of by certain manufacturers for such inputs received prior to 1.3.2003 where the duty of AED (GSI) was paid on inputs but no credit of such duty was taken at the material time as AED (GSI) was not leviable on finished goods manufactured out of these inputs. Certain examples of such finished goods are Tyres , Aerated Water, Biscuits, Shoes, Readymade garments etc.

3. The matter has been examined by Board and has been referred to Law Ministry for their opinion whether credit of AED (GSI) accrued prior to 1.3.2003 can be availed of and used for the payment of CENVAT duty as well as AED (GSI) on or after 1.3.2003. Accordingly, it is advised that necessary action to protect the revenue may be taken notwithstanding anything contained in the Board’s circular No. 700/16/2003-CX dated 6th March, 2003 on this issue. In this connection, TRU has already issued instruction vide letter F.No. 354/95/2003-TRU dated 10th September, 2003 which may also be referred to.

4. The details of availment of credit of AED (GSI), after 01.03.2003, of duty paid on inputs which had been received prior to 01.03.2003 by the manufacturers whose final products do not attract  levy of AED (GSI) during the period prior to 01.03.2003 may be furnished commodity wise in each Commissionerate to the undersigned on or before 10th October, 2003.

5. Field formations may please be informed suitably.

6. Receipt of the circular may be acknowledged.

7. Hindi version will follow.

Vijay Mohan Jain
Under Secretary to the Govt. of India

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