SALE OF SCRAP ARISE DURING THE JOB WORK
This query is : Resolved
06 January 2009
WE ARE MANUFACTURER OF STAMPINGS AND ALSO DOING JOB WORK. WE SOLD SCRAPS ARISING FROM JOB WORK AND CHARGED PLA DUTY FROM THE CUSTOMER AND PAID. BUT MY QUESTION IS THAT CAN WE AVAIL CENVAT BENIFIT ON SALE OF SUCH SCRAPS ? AND IS IT REQUIRED TO PAY DUTY TO THE MANUFACTURER OF WHICH JOB WORK HAD BEEN DONE ?
07 January 2009
Duty is to be paid on scrap generated. Such duty can be paid by Cenvat Credit. Further, whether such duty (or value of scrap) should be paid to the principal manufacturer or not is a commercial question, to be decided among yourself. If the manufacturer allow you to keep scrap, job charges is reduced; if he takes back the scrap, job charges are more.
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