Imported free of cost material for job work in EOU

[Asked by Guest]

Sir / Madam ,

We have a customer from USA who has sent us USA origin raw material free of cost to our EOU unit for job work. We will add indian origin raw material and produce final product . We will eventually export this product to customer . He wants us to only charge for the Indian origin raw material and processing cost .

How do we proceed on this situation as our excise officers are not aware of any such situation and donot know what to do and how to clear the goods

pl let me have your expert opinion .

regards

Rajendra Rane

Mumbai 9322221969

AI Summary

Transaction value must include free imported inputs and be stated in export invoice and ARE-1; collect only processing charges.
Imported free-of-cost inputs supplied to an EOU for job work must be included in the Transaction Value for export valuation; assessable value must reflect landed cost of all raw materials (imported and indigenous), processing charges and profit, and this transaction value must be shown on the export invoice and in Form ARE-1, although the exporter may collect only payment for indigenous material, processing charges and profit from the foreign customer.