Question : CENVAT is related to which of the following?
Option 1: Sales tax
Option 2: Excise duty
Option 3: Custom duty
Option 4: Service tax
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Correct Answer: Excise duty
Solution : The correct option is Excise duty .
A system called CENVAT (Central Value Added Tax) was established to deal with the taxing of goods and services. Businesses can claim credit under the CENVAT system for the excise duty paid on materials used in the production of goods. This aids in lowering producers' overall tax obligations.
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