Excise on job work

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shoeb parwaiz (Querist)
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21 March 2015 Dear All,

Kindly advise me on following issue:

Mr.X is a manufacturer & exporter of Leather Shoes. He manufactures upper part of shoe in his own factory send it to Job Worker to attach sole with the upper part of Shoe. The Job Workers charges excise duty only on the cost of sole that is attached by him. Now Assessing Officer has raised a objection to the Job Worker to charge excise duty on the complete shoe not on the cost of sole. If the objection of A.O.is correct and as per law, how can Mr.X save the duty.

Thanks & Regards,

Shoeb

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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21 March 2015 Provisions of Exemption to job work under Notification No.214/86
No duty liable to job worker- It has been held that there is no duty liability on the job worker when material is sent under Cenvat provision or under 214/86-CE.
Declaration under notification 214/86-CE- It is advisable that the declaration under Notification No. 214/86-Ce is given if the material is being sent directly to place of job worker from supplier of inputs, without bringing it in the factory, to avoid fruitless controversies.
Raw material as well as semi-finished goods can be sent out for job work. The exemption is available even if the job worker manufactures an intermediate product.
Notification No.214/86-CE does not prohibit a job worker from utilizing other inputs in addition to raw material received by him and recover charges therefore from the principal manufacturer.
- See more at: https://taxguru.in/excise-duty/excise-duty-job-work.html#sthash.rZNALE3G.dpuf

shoeb parwaiz

shoeb parwaiz (Querist)
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21 March 2015 Sir,

Thank you very much.

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