Job work scrap duty calculation

[Sunil Jagtap]

Material movement --- Aluminum foil sent to Job worker for printing – printed foil returned to us along with scrap/waste.

Now it is to be clarified that whether the scrap generated out of such normal manufacturing activity at Job work point, attracts, reversal of CENVAT credit already claimed at the time of purchase of material from vendor?

If CENVAT is to be reversed whether the value is to be taken as input value i.e., the rate purchased from vendor or the scrap rate which we are going realize at the time of sale of scrap.

Kindly clarify the same.

AI Summary

Aluminum Scrap Duty Confirmed at 12.5%, No CENVAT Credit Reversal Needed; Record in Daily Stock Account A query was raised regarding the duty calculation on aluminum scrap generated during job work, specifically whether CENVAT credit needs to be reversed. Three responses clarified that the aluminum scrap is subject to a 12.5% duty based on its transaction value. It was confirmed that there is no need to reverse the CENVAT credit initially claimed on the aluminum foil. The scrap should be cleared with duty payment, similar to any aluminum scrap from the factory, and recorded in the Daily Stock Account.