Modvat - Turnings and borings arising during manufacture of aluminium pistons out of aluminium ingots cannot be permitted to be removed under Rule 57F(2) without payment of duty

Aluminum piston turnings and borings require duty payment u/r 57F(2); unpaid duties must be recovered.

Turnings and borings produced during the manufacture of aluminum pistons from duty-paid aluminum ingots cannot be removed without duty payment under Rule 57F(2) of the MODVAT scheme. These materials do not qualify as inputs or partially processed inputs under the rule. Consequently, the removal of such turnings and borings requires appropriate duty payment. The duty paid on ingots made from these materials can be used to offset duty on pistons. The existing practice of removing turnings and borings without duty payment should cease immediately, and any unpaid duties should be recovered.