Understanding VAT and Cenvat Credit Offset on Raw Materials

You use the Item used For Personal Consumption program (P75I309) to offset the Cenvat credit claimed during the procurement of raw materials in these scenarios:

• Personal consumption of raw materials

  You must offset the Cenvat credit for raw materials that the manufacturer consumes internally.

• Nonsubmission of documentary evidence

  You must submit a document to claim the Cenvat credit, which identifies the excise duty liability incurred by the shipping organization. You must delete the records for which you have no documents before you process the Cenvat claim.

• Manufacture of exempted goods

  You cannot claim the Cenvat credit for manufacturing nonexcisable goods from excisable inputs.