Excise duty on exempted goods packed in exciseble goods

Also the roll is manufactured by its another division and storck trs recdeived duly duty paid

If the any raw material purchased by you on payment of excise duty, in turn Cenvat credit facility is not available to you since you are manufacturing wholly exempted goods. If the 'roll' is a raw material, no necessity to pay duty again at the time of conversion. If the 'roll' is manufactured by you and take for further process within your unit considering intermediate goods for manufacture of finished goods, duty requires to pay, if the 'roll' is dutiable by taking 110% value. 

Regards,

JMS

Thanks your reply sir, Pl explain me from the following example. X Is company A & B is Divisions of X A is manufacturing Plastic Roll and send to B as stock Transfer duly Excise paid on cost of Roll. B is manufacturing Atta which exempt from Excise Duty. B is processing Roll to Pouches and fill the tax free goods and sales as Atta. In this case B is liable to pay Excise Duty on process of Roll to Pouches.

Dear Deepak

You are manufacturing ATTA (Tax Free Goods as you say).

The Final product is 'Atta packed in Pouches' which is a tax free goods.

Please check classification of Atta packed in pouches.

This is not manufacture of pouches from Roll. The manufactured product is 'Atta packed in pouch'

Hope this helps you

In such situations, X A is paying duty and clearing goods to X B on Roll. Since both units are sister concern, X A is required to pay duty on 110% value and not on 100% value. Since both are seperate entities, the procedure following by you presently is abosuletly correct and just check that value is taken place 100% or 110% for duty determination. Though your product is exempted but paying duty on Roll (inputs) is required.

Regards,

JMS