Excise Cenvat in case of Dealer

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 May 2011 Sir an assessee is opening a new business. He will be dealer and will export some part of its product out of India. What is the best procedure through which CENVAT benefit can be availed by him:
1. By purchasing goods without paying duty OR
2. By paying duty and then claiming refund

What is the procedure for the same?
Also should he obtain Excise Number or not? I came to know that he need not apply for registration as his sales will be less than 1.5 crores.

U S Sharma

U S Sharma (Expert)
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23 May 2011 1) if he is dealer, then how he can have its product?

2) for export you have to start the process from factory itself, clear the goods from factory under ARE-1, by paying duty under rebate / without duty under bond and CT-1, as after getting cleared as for home consumption, diverting to export will need so many paper work and certification from range.

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Querist : Anonymous

Querist : Anonymous (Querist)

24 May 2011 Sir the assessee is purchasing iron & steel items from manufacturer who is charging excise. The Gross sales of dealer is around 1 crore. Half of his sale proceeds will come from Exports. Now he wants to take benefit of excise paid by him at the time of purchase in respect of those goods which are to be exported.
How can he avail the benefit of excise paid by him?

U S Sharma

U S Sharma (Expert)
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24 May 2011 for purchase without duty you have to execute a bond with the DC of manufacturer excise division, issue CT1 and ARE1 and get the goods without payment of duty for export,

if u want to avail rebate of duty claimed, then at the time of clearence, provide ARE1, manufacturere will clear the goods under "inv for export" will countersign the ARE1, and after export you will have to file the claim to his DC, who will verify the claim and allow u rebate.

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Querist : Anonymous

Querist : Anonymous (Querist)

24 May 2011 Thanks sir.
Sir should he need to obtain Excise Registration No. in both cases as his Total Sales will be below 1.5 Crores ?

U S Sharma

U S Sharma (Expert)
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24 May 2011 Excise registration for manufacture is 1.5 cr, for dealership there is no such bar/ limit,

Querist : Anonymous

Querist : Anonymous (Querist)

25 May 2011 then to avail CENVAT benefit i.e. rebate or refund of duty, should dealer need to obtain Registration No. OR he can claim rebate or refund of duty without having excise registration.

U S Sharma

U S Sharma (Expert)
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26 May 2011 for claiming refund of duty, the exporter does not need getting registered at excise,

Exporter has to get the goods cleared from factory of manufacture, under cover of "export invoice" and "ARE-1", with disclaimer of manufacturer on ARE-1, that they will not claim the rebate of duty against the subject ARE-1.

after Export, the exporter has to file the rebate claim with original and duplicate copies of ARE-1 duly passed from customs, copy of B/L, copy of shipping bill E/P copy, to the DC/AC of the manufacturer division or maritime commissioner of port of export ( as mentioned in ARE-1 at the time of preperation), who will match the duty payment with triplicate copy of ARE-1, and other relevant details and sanction the rebate of duty paid on export invoice under cover of ARE-1.

such claims should be filed within 180 days of clearance from factory.

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