Storage of Duty Paid Raw Material

[Rajesh Reddy]

Hi

I am an SSI engaged in the manufacture of corrugated boxes and am registered under central excise. I have since inception not exceeded the SSI exemption limit of ₹ 1.5 crores but have for the purpose of clearing goods meant for export against CT3, registered my proprietory unit under Central Excise. I have also, since inception, not availed any CENVAT Credit. Owing to space constraint at my factory I am from time to time storing raw material (primarily Kraft Paper) at a rented godown. I am however not storing finished/semi-finished goods, nor am I carrying out any manufacturing activity in the said godown. I am of the opinion that so long as I am not availing CENVAT Credit, “duty paid” Raw Material may be stored anywhere and the godown where such material is being stored need not be registered under central excise. I am hoping for the experts to shed some light on whether my stated position is tenable or must i register the godown ? Can you please point me to the relevent Notification(s) and/or Rule(s) that deals with this peculiar situation (if at all).

Regards

Rajesh

[YAGAY andSUN]

You may get the permission for the Commissioner of Central Excise under Rule 4(4).

[MAHESH MAIYA]

Hi,

Refer Rule 8 of Cenvat Credit Rules, 2004 with procedure mentioned in Latest Supplementary Instructions page no. 6.240 of central excise law manual 2015-16.

Thanks

Mahesh Maiya. P

9448680200

AI Summary

Clarification sought on storing duty-paid raw materials in unregistered godown without CENVAT Credit under Rule 4(4) and Rule 8. A small-scale industry (SSI) engaged in manufacturing corrugated boxes and registered under central excise is storing duty-paid raw materials, specifically Kraft Paper, in a rented godown due to space constraints. The proprietor has not exceeded the SSI exemption limit and has not availed CENVAT Credit. The query seeks clarification on whether storing raw materials in an unregistered godown is permissible without availing CENVAT Credit. Responses suggest obtaining permission from the Commissioner of Central Excise under Rule 4(4) and refer to Rule 8 of the Cenvat Credit Rules, 2004, and the relevant instructions in the central excise law manual.