GOODS RETURN

[SURYAKANT MITHBAVKAR]

 

We are manufacturer of Pharmaceuticals Machinery. We cleared one machine to our customer in 2011 now the same customer intend to return the same as sale of assets to us with payment of duty.

If  the said machine we take as input &  dismantle the parts &  use the parts in various machinery wherever

suitable and some parts  cleared as scarp.

 In this procedure  we do not have any co- relation regarding clearance of machine parts of the said    

machine.

Whereas the Law says if  we take credit on  Finished Goods which is return by our customer it is importance

to show clearance of the same with payment of Excise duty either equal to credit or more than credit avail. 

Still can we avail credit in the above matter.

Pl. advice. 

AI Summary

Pharmaceutical machinery manufacturer advised on CENVAT credit and excise duty under Rule 16 for dismantled machine parts. A manufacturer of pharmaceutical machinery inquired about the return of a machine sold to a customer in 2011, which the customer now wants to return as a sale of assets with duty payment. The manufacturer plans to dismantle the machine and use its parts in other machinery or sell them as scrap, raising concerns about the correlation required for excise duty credit. The response advised that under Rule 16, the manufacturer can claim CENVAT credit if the goods are remade or processed. If the process constitutes manufacturing, duty must be paid on removal based on the current rate and value.