Removal of Goods after being remade under Rule 16

[Gaurang Shukla]

Can a manufacturer receive goods for repair/remaking/refurbishment under Rule 16 , 

supply a new article from whom the goods are received and supply the refurbished/reconditioned item to another unit ? 

The question is - whether goods can be recycled amongst various manufactures who are sending goods for reconditioning ? If yes , how is the Duty liability to be discharged.

The question here is not of Cenvat Credit. THe manufacturer does not take credit as the goods are not accompanied with duty paying documents. Also , the goods being received for repair /reconditioning are not necessarily manufactured by him. Permission is availed under Sub rule 3 of Rule 16 from Commissioner.

Please clarify

Thanks

  

AI Summary

Excise duty on remanufactured or repaired goods must be paid when replacements or repaired items lack duty documentation.
Duty is chargeable when a manufacturer supplies a new article from stock in lieu of a returned item and when repaired goods are cleared without duty-paying documents; the repairing manufacturer must pay duty unless it can prove the repair does not amount to manufacture. Original manufacturers can establish duty-paid status from their records and take credit, while third-party repaired goods lacking duty documentation are dutiable. Inputs used in repair may require reversal of credit and proper accounts must be kept. Permission under sub rule (3) of Rule 16 may be sought but does not replace proof of duty-paid status.