Invoice for Captive Consumption

Yes you hve to.

The valuation of the goods which are captively consumed by the assessee will be taken at 110 % of the cost of manufacture of the goods.

[Rule 8 of the Central excise valuation (Determination of price of excisable goods rules 2000)] the goods is required to be removed after discharging the duty.

One of my collegues comments are as under:

There is no need to prepare an Excise Invoice for 'captive consumption' for finished components / products because :

1) Exemption Notification, for Captive Consumption, No. 67/95 does not specify any requirement of preparing an Excise Invoice.

2) Rule 5 of the CER 2002, on 'Date for determination of duty and tariff valuation' states that : Explanation - If any excisable goods are used within the factory, 'the date of removal of such goods' shall mean the date on which the goods are issued for such use.

From the wording of this Rule, it is very clear that the 'issuing document' is acceptable for accounting the 'quantity issued' and no excise invoice needs to be prepared.

3) Rule 11 of the CER 2002 states that : No excisable goods shall be removed from a factory or ................ except under an invoice ......................

From the wording of this Rule, it is clear that when the excisable goods are removed from a factory then only excise invoice needs to be prepared. When the rule is silent about the removal within the factory, it is evident that no excise invoice needs to be prepared.

Considering legal position at Sr. Nos. 1 to 3 above, it can be concluded that there is no need to prepare any excise invoice for captive consumption.

I AGREE WITH THE COMMENT OF AMBADAS COLLEAGUE

Agree on the above opinion