CLEARANCE TO R & D UNIT

[SURYAKANT MITHBAVKAR]

If we clear materials to R and D unit without payment of excise duty under Notification No. 16/2007 C.E. dated 01.03.2007.

In view of the above we have to pay @6% on assessable value as excise duty by way of reverse cenvat credit used to Manufacturing the same Material.

Pl. advice us it is correct or not.

AI Summary

Excise duty liability on clearances to R&D units must be discharged via reverse cenvat credit when notification conditions apply.
Clearance of goods to an R&D unit under the relevant excise notification attracts an excise duty liability on the assessable value; that liability is to be discharged by way of reverse cenvat credit applied to manufacture of the same material, provided the conditions set out in the notification are satisfied.