Inter Plant transfer of Capital goods

[RAJESH IYER]

 Notification 12/2013 amendment of CCR is as under:

(5A) (a) If the capital goods, on which CENVAT credit has been taken, are removed after being used, the manufacturer or provider of output services shall pay an amount equal to the CENVAT Credit taken on the said capital goods reduced by the percentage points calculated by straight line method as specified below for each quarter of a year or part thereof from the date of taking the CENVAT Credit, namely:-

(i)     for computers and computer peripherals:

 

for each quarter in the first year at the rate of 10 percent

for each quarter in the second year at the rate of 8 percent

for each quarter in the third year at the rate of 5 percent

for each quarter in the fourth and fifth year at the rate of 1 percent

 

(ii)    for capital goods, other than computers and computer peripherals at the rate of 2.5 percent for each quarter:

Provided that if the amount so calculated is less than the amount equal to the duty leviable on transaction value, the amount to be paid shall be equal to the duty leviable on transaction value.

(b) If the capital goods are cleared as waste and scrap, the manufacturer shall pay an amount equal to the duty leviable on transaction value.”

My Question is in the case of Inter Plant transfer of Capital goods as such, Transaction Value is applicable or not, as there is no sale.

RAJESH.N

AI Summary

Debate on using transaction value for inter-plant capital goods transfers under Central Excise rules, referencing Notification 12/2013. A query was raised regarding the applicability of transaction value for inter-plant transfers of capital goods under Central Excise rules, specifically when there is no sale involved. The discussion referenced Notification 12/2013, which outlines the calculation of CENVAT credit on removed capital goods. One response indicated that transaction value is not applicable for such transfers, while another highlighted that the rules focus on 'removal' rather than 'sale,' suggesting transaction value should be used to calculate Central Excise Duty on capital goods.