Manufacturing and trading item

[Sushil Kumar Sharma]

Dear seniors,

Please clear my doubt about the manufacturing item and trading item.

our some goods we have manufacturing in plant and some item bought from market.

can we sale as trading item by separate.

Manufacturing unit can sale trading goods in unit.without excise.

pl.suggest me

Thanks

Sushil Sharma

[Sushil Kumar Sharma]

Dear seniors,

any one have no answer.for above these type query.

[Mahir S]

Sir, A manufacturer may bring duty paid goods in the registered manufacturing premises for trading purpose and no permission in this regard is warranted from the Central Excise Department. However, a factory cannot be allowed to receive goods from outside, which are identical to those manufactured by them for which proper permission from the Commissioner is required.

Further, you will be required to maintain Separate books of accounts and also carry out Remarking of area intending for trading activities.

Also, service tax credit shall be required to be reversed for common services used both for the manufacturing and trading activities, such as security supply services, etc.

[Sushil Kumar Sharma]

Dear sir/madam,

Any one suggest to me on above mater.

Thanks

Sushil Sharma

[Ashok Aggarwal]

Dear Mr Sharma,

Mr Mihir has answered your query. I agree with him with an advice that even if you are trading in goods different from the goods being manufactured by you, you should intimate the jurisdictional Range Superintendent and maintain separate accounts for manufacturing and trading activities.

You cannot take Cenvat Credit of the service tax on input services which are exclusively utilized in the trading activity and for common input services, you must reverse the credit proportionately for trading activity. The value of trading activity service is equal to difference in your sale value and purchase value of traded goods or 10% of purchase value whichever is more.

Ashok Aggarwal

[Sushil Kumar Sharma]

A lot of thanks sir,

AI Summary

Manufacturer trading goods: duty-paid trading stock may be sold without excise but compliance requires separation of accounts and credit reversals.
A manufacturer may bring duty-paid trading stock into the registered manufacturing premises and sell it without prior excise permission, but receipt of goods identical to those manufactured requires Commissioner permission. The manufacturer must intimate the Range Superintendent and maintain separate books and remark the trading area. Cenvat/service tax credit cannot be claimed for services exclusively used in trading and must be proportionately reversed for common services; the trading-attributable service value is the sale-purchase difference or ten percent of purchase value, whichever is higher.