Excise duty on Ready Made Garments under Chapter 61, 62 and 63

[Sanketh Meri]

Dear All,

We are a Garment Manufacturing unit producing readymade garments on contract for certain brand. Our Brand Owner is not disclosing their RSP to us and hence we are not affixing Price Label. Hence, in such a case whether we are exempt from Excise Duty or whether we have to discharge excise duty under section 4 at transaction value.

AI Summary

Excise liability on branded garments: contract manufacturers may be liable when labeling constitutes manufacture; seek advance ruling.
Whether excise duty falls on a contract manufacturer when the brand owner withholds the Retail Sale Price depends on whether affixing RSP or branding constitutes manufacture; labelling by the brand owner can trigger duty based on tariff value linked to RSP, departmental circulars help interpret but lack statutory force, contract terms determine which party bears liability, and practical steps include seeking an advance ruling or paying duty under protest.