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Excise duty exemption on ssi (Excise)

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This query is : Resolved

Author : Anonymous

( Author )
01 October 2012

Sir, We are a SSI unit manufacturing Packaging materials for various other companies, right now our turnover is around 1 crore and as such we have not registered under excise, we expect the turnover to double from the next financial year what are we supposed to do.
Also please elaborate on this term
First slab of 150 lakhs - There is full exemption from excise upto the first clearances of Rs. 150 lakhs, starting from 1st April every year,
Second slab after initial 150 lakhs - After the turnover crosses Rs. 150 lakhs, full normal duty is payable. The SSI unit can avail Cenvat credit on inputs in respect of inputs used after turnover crosses Rs 150 lakhs.

i am not able to understand this. presently we purchase raw materials from a dealer who is under excise, he gives us a excise invoice but we do not claim modvat. What are the changes we have to do in case we need to avail the modvat. Does full exemption from excise mean that the said dealer should give us the material without charging excise duty to us. Kindly clarify


U S Sharma

( Expert )
02 October 2012

under notification 8/2003 (SSI) 1st slab is 150 Lacs, and 2nd slab is 400 lacs ( gross turnover for SSI including the 1st 150 lacs)

after 150 lacs duty is payable and one can opt for cenvat facility.

upto 150 lacs no cenvat credit is admissible if you opt for 8/2003(SSI benefit)

side by side if you dont opt for 8/2003 and start to pay duty from zero level, then you can avail cenvat credit from zero level,

every material is duty paid by default, SSI does not mean that its not paid, coz the raw materials used were duty paid. only diff that such invoices are not eligible for cenvat credit by next buyer.


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