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Excise duty on scrap sale

Sachin Waje (Taxation Executive) (102 Points)

19 December 2011

Dear Sir,

We are come under excise act from Aug 2011. We have to do scrap sale whether we charge excise duty on scrap sale. on that material we were not taken cenvat credit.

Please advice on the same

Regards

Sachin Waje

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12 Replies

valji (Accounts manager-MBA) (2150 Points)
Replied 19 December 2011

you have to charged excise duty on scrap sale since scrap is generate from production

also take cenvat credit for the same

1 Like

CA Garav Gulati (Management Consultant) (106 Points)
Replied 19 December 2011

You have to pay the excise on scrap and cenvat credit can be taken

Sachin Waje (Taxation Executive) (102 Points)
Replied 19 December 2011

If any notification is there for the same..................???

CA Garav Gulati (Management Consultant) (106 Points)
Replied 19 December 2011

Please clarify whether you were SSI before august 11. or product was not exciable first subsequently charged to excise by excise notification.

CA Garav Gulati (Management Consultant) (106 Points)
Replied 19 December 2011

if you were under SSI exemption then as per rule 4 of cer it will be chargeable to tax and as per transition provisions of ccr 2004 CCR will be available.

CA Unnikrishnan Nair N (Chartered Accountant) (2083 Points)
Replied 19 December 2011

You can claim cenvat credit on the transition stock including scrap. Clearance of scrap arising from manufacture is liable to duty.

HS Negi (Senior Executive- F&A) (590 Points)
Replied 20 December 2011

If duty has been paid on the purchase of origional input on which scrap is generated, then scap of the same is liable to be charged with excise duty and if the origional input is not covered in excise or duty not paid then no need to pay excise duty on scrap.

In some case, suppose some material contained in a smaller container then clearance of container is liable to be charged excise duty.

Regards

HS Negi.

HS Negi (Senior Executive- F&A) (590 Points)
Replied 20 December 2011

Dear Sachin,

If excise duty is paid at the purchase of original input on which scrap is generated, then scarp of such is liable to be paid with excise duty. On the other hand, if excise duty is not paid the time of purchase, scrap of such would not be liable to paid with excise duty.

In some cases, most of input comes in very small container, excise duty is paid for such input . But clearance of such container would not come under the net of excise duty.

In your case, I understand that you have purchased the input with payment of excise duty and you have not availed the cenvat credit, which is to be availed by you. Then scrap of such is liable to be paid with excise duty and cenvat credit is available to you.

Best Regards

HS Negi

HS Negi (Senior Executive- F&A) (590 Points)
Replied 20 December 2011

Dear Sachin,

In some cases, most of input comes in very small container, excise duty is paid for such input . But clearance of such container would not come under the net of excise duty.

Best Regards

HS Negi

rajeshwari (accounts) (21 Points)
Replied 10 June 2015

Dear Sir,

scrap sale duty -12% or12.5%

Please guide us

Sandip Choudhury (Factory Manager) (65 Points)
Replied 09 March 2016

Dear Sir

We are availling notification 16/2012, our manufacture is Ball and Gel pen under chapter 9608, also we are not taking any Cenvat, so could we liabile to pay excise duty on scrap sales.

thanks & regards

Sandip Choudhury

Balu S (26 Points)
Replied 22 July 2016

Dear Krishnana,

I am a manufacturing company, i purchased a material from manufacturer & 1st stage ED Delar. I had taken CENT VAT Credit for the same. After finishing the process of goods, some of the scrap is pending. i want to sale the scrap to others for scraping. shoul i charge the Excise Duty & VAT also. Can you answer me pls.