Removal of goods from Depot to Job worker

[Asked by Guest]

Dear Sir,

Please advise us whether we can clear goods to JOB worker without payment of excise duty from depot.If yes than wheteher any permission will be required for such clearance.

2) If we are clearing material from factory to Job worker whether any permission will be required and further whether we can receive back such material to our Depot.Thanks and regards.

[KASTURI SETHI]

Sh.Shinde Ji,

Query-wise reply is as under :-

1. NO. When the excisable goods are completely finished and they are entered into Finished Stock Register (RG-1 register) and from there goods are transferred to depot for storage and sale purpose.Entry in RG-1 means goods are ready for final clearance/sale/stock transfer to depot. Depot is also registered as first stage dealer. In case CE duty has been paid at the factory gate, then the department has nothing to do. There is no restriction on movement of duty paid goods.

2. Material stands for inputs. No permission is required. Only intimation under Notification no.214/86-CE as amended is required.

[MUKUND THAKKAR]

Rightly explain by Sh. Kasturi Sethiji....

[CSSANJAY MALHOTRA]

Dear Mr. Shinde,

In addition to Sh. Kasturi ji views, please also go through Rule 16B & 16C of Central Excise Rules 2002, where scenario changes as per the nature of product. (Don't know about your case as is not specified as rightly considered by Sh. Kasturi ji as Inputs.)

There might be situation in some cases where the process amounts to manufacture on goods sent from warehouse to Job Worker., thereat Central Excise will demand differential duty and may advise to follow procedure as per Rule 16C.

Yes in case of 2nd query if the same is semi-finished goods.

 

 

 

For e.g. Permission from Commissioner is required under Rule 16C of Central Excise Rules 2002 if the item

[MUKUND THAKKAR]

view of Sh.SANJAY MALHOTRA sir. is welcome.. nice addition sirji.

[YAGAY and SUN]

In our view a special permission shall be required in first scenario and in second scenario also permission is required either in 214/86 or under rule 16B/C.

[CSSANJAY MALHOTRA]

Dear M/s Yagay and Sun,

Would appreciate if you could share the provisions for enhancing my knowledge wherein permissions is required under Notf 214/86. May be I have missed upon some amendment, which provides for seeking permission on the ongoing issue.

Permission under Rule 16B/16C, we all agree is required from Commissioner Central Excise.

[KASTURI SETHI]

Sh.CS Sanjay Malhotra Ji,

Sir, I have perused all the amendments made to Notification No.214/86-CE till date. The condition of filing an undertaking is still intact. It has not been disturbed till date. Undertaking binds the Principal Manufacturer.

 

[CSSANJAY MALHOTRA]

Dear Sh. Kasturi ji,

Thanks for the update, hence to conclude, it's only the undertaking and not the Permission under 214/86.

[Ganeshan Kalyani]

Enriching discussion indeed.

AI Summary

Movement of excisable goods: duty-paid finished goods may move freely to depot; inputs require intimation or undertaking.
Finished excisable goods entered in Finished Stock Register (RG 1) and duty paid may be transferred to depot and moved without departmental restriction; depot is a first stage dealer and no permission is required. Inputs sent to a job worker require no permission but do require intimation/undertaking under Notification No.214/86 CE binding the principal manufacturer. If processing at the job worker amounts to manufacture or involves semi finished goods, Rule 16B/16C may apply and permission from the Commissioner and potential differential duty liability can be required.