valuation job work

[Mukund Thakkar]

sir,

My client is putting order to me on following manner.he is not registered manufacturer but procure the raw material and forwarding to me,

on the based of his design and drawing final product comes in existence, he will paying us labour charges (sub contracting charges), please suggest me valuation in this regards.

example;-

1) raw material Rs 1000/-

2) transportation is arranging by customer. ₹ 100/-

3) Insurance in scope of job worker. ₹ 50/-

4) sub contracting charges ₹ 10 (labour charges)

5) excise 12.36% and applicable VAT.

6) After existence of final product, we will have to dispatches as per place suggested by customer, please not in depot, but same will be used for own.

In such situation please guide me which value is applicable for billing during the time of clearance.

AI Summary

Guidance on Excise Duty Valuation: Rule 10A vs. Ujagar Prints Case for Non-Registered Manufacturers. A client, not a registered manufacturer, supplies raw materials and designs to a job worker, who then produces a final product. The client pays subcontracting charges, and the query seeks guidance on the appropriate valuation for excise duty. Responses suggest applying Rule 10A of the Central Excise Valuation Rules, adding raw material costs, insurance, subcontracting charges, and the principal manufacturer's profit to determine the transaction value. However, since the supplier is not excise-registered, Rule 10A may not apply, and the valuation should follow the Ujagar Prints case, considering raw material costs and job work charges.