Trading of raw material from manufacturing premises

Excise Duty is levied on the manufacturing activity and not the trading actvity so if you are going to trade the raw material (ie steel coil), then you shall have to register with the VAT Department and obtain a VAT Registration certificate. Therefore at the time of selling the you will charge VAT in the sales invoice.

If you are manufacturing the steel coils, then the Excise Duty will be levied in the invoice which will be collected from the buyer.

In the invoice of the Steel coil, you will be charging excise duty as well as VAT.

No separate are is required. But VAT records should be maintained separately.

Regards,

Devendra Kulkarni

1. You can bring duty paid goods in the registered manufacturing premises for the purpose of trading. But as a registered trader you can not pass the cenvat credit from same premises. If you want to pass the cenvat credit as a dealer then premises should be saperate. You can not be register in same premises as a manufacturing and trading activity. 

2. Registered dealer can not take the cenvat credit only you can pass the cenvat credit.

3. You can not charge the excise duty on aditional charges. 

4.  Premises should be saperate. If both activity is registered under central excise.

1) Do we need a separate trader registeration with the central exise for this purpose, if we do trading of steel coils from our manufacturing premise?

Yes. If you want to transfer the excise duty for your customer, you should register with excise as a dealer.

2) Can we take Cenvat credit on the coils we are going to trade and pass the same to the buyer?

As a dealer, you are eligle to take cenvat credit for your purchase against supplier invoice and pass it to your custmer

3) Do we need to charge additional duty on the margin while trading or should be levy the same duty for which the cenvat credit was taken?

No. it is not required. because u r a trader not manufacuturer

4) Do we need to make separate records or separate area or both for this purpose in our manufacturing premise?

Yes. because the same material using as input for your manufacuring goods.  In this case separate premises and separte account is required for better accounting.

If required any futher details, pls contact RP Ananthakumar, Coimbatore, 9994980047

sirs,

if we are getting registered as a manufacturer and dealer under the same premises, are we eligible to take SAD claim for the dealership transactions.

Syam sankar