Difference between MFG Depot and Dealer

[Guest]

Dear Sir,

Please explain the difference between Manfacturer's Depot and Dealer registered under Excise, please give us any reference regarding this,Thanks and regards.

[YAGAY andSUN]

Dear Sandesh,

Manufacturer's Depot is the extended arm of manufacturing unit from where the goods are removed to the ultimate customers on passing on of CENVAT credit whereas dealer are independent sellers (FSD/SSD) who buy goods from manufacturer/FSD respectively and pass on the CENVAT credit accordingly. On depot sale principle of nearest point of sale is applicable whereas on dealers it is not applicable

Regards,

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

AI Summary

CENVAT credit flow: manufacturer's depot treated as extended arm allowing credit transfer, dealer remains independent seller. A Manufacturer's Depot is an extended arm of the manufacturing unit treated as part of the factory's distribution network, enabling the passage of CENVAT credit on removals to customers; by contrast, a Dealer is an independent seller who purchases and resells goods and passes on CENVAT credit through ordinary commercial transactions. The nearest point of sale principle applies to depot sales but not to dealers.