Reversal of exicse duty for Scrap generation

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Deepak Agrawal (Querist)
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05 May 2009 Hi,

Company purhases M.S Angles, STeel Plates, etc for producing heavy engineering goods. It has taken excise duty credit when it was purchased.
While production, some scrap is generated. So i want to know about excise treatment.

Does the company need to reverse some amount of the excise duy credit taken ?

Also reply me abt the rule number which governs the excise treatment on scrap.

Madhukar N Hiregange

Madhukar N Hiregange (Expert)
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06 May 2009 Where credit has been availed for the raw materials there should be a duty debit at the time of removal of the scrap. If the scrap is at the job workers end then either the JW or the princiapl would have to diuscharge the duty on the notional value of the scrap retained bythe JW.
The movement of the scrap is important to decide the timing of the debits.

Deepak Agrawal

Deepak Agrawal (Querist)
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07 May 2009 i AM MANUFACTURING AT MY FACTORY, IRON CHIPS ARE GENERATED WHICH ARE SOLD AS SCRAP.

AS REGARDS DEBIT, HOW AMOUNT IS DETERMINED.

DO WE HAVE TO REVERSE EXCISE CREDIT ON RAW MATERIAL ?