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Rule 16 excise
Dear all,
Please explain Rule 16 of Central Excise Rules related to Credit of duty on goods brought to the factory with example.
Please its urgent.
Replies (6)
Sales return can be best example.
The duty paid at the time of clearance of goods can be taken as credit if there is any sales return out of that slot. And again if you do some modifications, again wen u sell such goods, u hav to pay exices duty. !!!!!
Thanks a lot sir!!
Rule 16 allows credit for goods which are returned. If you resell without process amounting to manufacture then, duty reversal is to be done. If process amounts to manufacture then pay duty based on transaction value.
Thank u for the reply. Another doubt. If I sell the goods without processing, then I need to pay an amount equal to credit taken. So my question is can I utilise CENVAT credit for such payment?? Because in Rule 3(4) which deals with utilisation of CENVAT credit, has not mentioned about this payment.
It is not allowed in the rule to avail credit if process does not amounts to manufacture. Hence, you cannot avail the credit
Absolutely correct. Thank u sir.
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