SSI exemption to Ready Mix Concrete

[Ramesh Patel]

We are mfg of cement concrete products and Ready Mix Concrete. at present we are availing basic exemption. Since RMC comes under concessional rate of duty, whether we are liable to pay duty on RMC without availing basic exemption.

[Rajagopalan Ranganathan]

Sir,

Ready mix concrete is classifiable under chapter 68 of I Schedule of Central Excise Tariff Act, 1985 (1 of 1986). Notification No. 8/2003-CE dated 1.3.2003 exempts clearances, specified in column (2) of the Table appended to the Notification for home consumption of excisable goods of the description specified in the Annexure appended to the notification. In the Annexure to the Notification at Sl. No. xxvi (a) all goods falling under Chapter 68 is mentioned. Therefore all goods falling under chapter 68 are exempt from payment of duty up to a value of 150 lakhs.

Only when you have crossed the limit of 150 lakhs, you have to pay duty on Ready mix concrete. At that time you have to pay duty @2% without CENVAT Credit under Notification No. 1/2011-CE dated 1.3.2011 or 6% with CENVAT Credit under Notification No. 2/2011-CE dated 1.3.2011..

AI Summary

Ready Mix Concrete Exemption: Duty-Free Up to 150 Lakhs, Then 2% or 6% Duty per Excise Notifications A manufacturer of cement concrete products and ready mix concrete inquired about the applicability of basic exemption on ready mix concrete under central excise laws. The response clarified that ready mix concrete is classified under Chapter 68 of the Central Excise Tariff Act. According to Notification No. 8/2003-CE, goods under Chapter 68 are exempt from duty up to a clearance value of 150 lakhs. Once this limit is exceeded, duty must be paid at 2% without CENVAT Credit or 6% with CENVAT Credit, as per Notifications No. 1/2011-CE and No. 2/2011-CE, respectively.