Levy of Excise Duty

This query is : Resolved

Mahendra Singh Dhatarwal (Querist)
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20 October 2010 Hi, I have some confusion regarding the excise duty. We have a intermediate product which is not the finished product. We want to send it for testing purpose to other location and then will be destroyed. This has been processed but not in any form to be sold but as per Excise rules it is excisable but it doesnt full fill the requirement of marketability. The quantity is 50kg.
Please suggest whether we should pay the excise duty or not.

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
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21 October 2010 If no marketability , no excise duty. Marketability doesnot mean for your company, this should be in common practice. If as per excise rule this is excisable, that means there is a chance for marketability.

Secondly, if there is no marketability, why you are sending it for testing purpose ?

PLZ give the reason.

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Madhukar N Hiregange

Madhukar N Hiregange (Expert)
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21 October 2010 The fact that it is not a product but couldbe said to be a prottype in development stage means that ED need not be charged. Cenvat credit on the raw materials also should not be availed.

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Mahendra Singh Dhatarwal

Mahendra Singh Dhatarwal (Querist)
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21 October 2010 Mr. Madhukar rightly said that the product is in intermideate stage not the final product and we can not name it.

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