Transfer of duty free material to other unit

[Yatin Bhopi]

Dear Sir,

We are manufacturer & having four units. We are also registered under LTU. All our units are available under IEC certificate.  We want to transfer one of our duty free material (imported against DEEC scheme) to one of our other unit. In hand book of procedure vol-1, Para 4.5- Advance authorization for application with multiple units; it appeared that we can transfer duty free material to our other unit. Please express your views. Please also let me know any other procedure in this regard.

[YAGAY andSUN]

Yes, under LTU you can transfer the goods from one unit to other but export obligation would remain in force.

[Yatin Bhopi]

Sir,

The purpose of transferring duty material from one unit to another unit is not for job work but for manufacturing final goods of transferee unit (other unit), Since material is duty free we hope no excise duty is payable (since we are in LTU input can be clear without payment of duty to sister unit). Pl. confirm.

Please give the detail procedure and excise/DGFT formalities.

AI Summary

LTU transfer of duty free inputs allowed but export obligation continues; confirm excise and procedural formalities. Under LTU arrangements, inter unit transfer of duty free goods imported under the DEEC scheme is permissible, but the export obligation associated with the authorization remains in force; the query seeks confirmation on excise liability for clearance to a sister unit and the detailed DGFT/excise procedural formalities for such transfers.