Stock transfer of semi finished goods to head office

Dear sir,

We are a registered Export House . We are PartnerShip Firm Having Head office in Mumbai and Branch Office ( Main factory ) In Chennai. We are Dealing with Leather Goods Like Belts/Wallets & Bags. We are 80% Export Oriented and 20% Domestic. As Our Main Rawmaterial is Leather , so we are not availing CENVAT CREDIT instead of this we are Going for Customs DRAWBACK against Our Export sales.

In our Purchases we have not taken any Input credit of Excise duty as we are not availing Cenvat Credit.  we manufactured the Final Product Wallets /Bags / Belts and we are clearing With EXCISE DUTY @ 12.5% in Domestic Market and Selling Without EXCISE in EXPORT by LUT Bond.

So in this Business we have to transfer some of the Semi Finished Products ( That is unfinished Bags/Wallets/Belts ) for Further Processing to Our Mumbai Head Office and Selling Directly from there as an EXPORT Sales. For This Transaction EXCISE Duty will be applicable or Not? Please Confirm. We are not claiming CENVAT CREDIT. Shall This Be Dutiable under Rule 8 or 9 of cenvat cerdit Valuation rule.

As an Assesse we are not in a position to Pay Excise on Semi Finished Products which is not marketable. and adding to this we are not taken any Cenvat credit on the Inputs used in this semi finished Products. 

Please advise in this Regard..

 

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