Excise duty of raw material trading

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seshadev sahoo (Querist)
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19 March 2013 Sir,

We are manufacturer of all type of fencing material & accessories, Our main inpur Raw material is Galvanise Wire. Some times Galvanise wire require to tie of our finished goods. So that we have to sold our raw material to the customer. In this case which rate of excise duty will be applicable, it will be on transaction value or we should go with input remove as such procedure under rule 3/4 of ccr 2004.

Please help me.

Thanks,

Rajeev Kumar Garg

Rajeev Kumar Garg (Expert)
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21 March 2013 SORRY, YOUR QUESTION IS NOT VERY CLEAR TO ME. BUT AS I HAVE UNDERSTOOD THAT YOU ARE USING YOUR RAW MATERIAL - "GALVANISE WIRE" IN PACKING OF YOUR FINISHED GOODS AND YOU ARE NOT CHARGING ITS COST FROM YOUR BUYER SEPARATELY. I THINK THAT THE COST OF THIS RAW MATERIALS WOULD HAVE INCLUDED IN YOUR SALE VALUE OF THE PRODUCT. HENCE DUTY WILL BE CHARGED OR DISCHARGED ON YOUR TRANSACTION VALUE AS PER SECTION 4.

RULE 3 (4) OF CENVAT CR. RULES, 2004 IS APPLICABLE WHEN INPUTS ARE REMOVED AS SUCH ONLY WITHOUT CHANGING ITS PRIMARY FORM. THE DESCRIPTION AND CETSH. OF GOODS SHOULD BE MENTIONED ON YOUR INVOICE SAME AS OF RAW MATERIAL NOT OF FINISHED GOODS.
THANKS.
PL. CLICK ON "THANKS USER", IF YOU ARE SATISFIED WITH MY REPLY.
R.K. GARG.
CONSULTANT

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