Excise duty on Inhouse Captital Goods/Sapares

[Guest]

R/sir,We are Manufacturing of Chemical as a Finished Goods and pay duty at the time of Removal . But we have prepare in house toolsand spares with purchase of raw material excisable and Non Excisable . Can Duty liability on this toolsand spares ? Please guide in this query . Thanks Snehal Shah

[VINOD KUMAR]

Dear snehal, These tools and spares are exempt if:-1. Manufactured within your factory. 2. Used within your factory for manufacturing of dutiable final product. Please refer Notification No. 67/1995-CE for details.

[YAGAY and SUN]

Dear Snehal,

Manufacturing of capital goods for captive use, are exempted under Notification No. 67/1995-C.E., since these goods remains in the factory itself and are not being removed.

Regards

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

AI Summary

Exemption for in-house capital goods confirms no excise duty where tools and spares are manufactured and used within the factory. In-house manufactured tools, spares and capital goods used within the same factory for production of dutiable final products are not liable to excise duty where they are not removed from the factory; the exemption covers captive manufacture and internal use in the manufacturing process.