JEWELLERY / nominated agencies

[Arun Aggarwal]

Sir

If I buy goldbars from nominated agencies under para 4.34 of FTP 2015-20 which is duty free for exports for jewellery as advance procurement

Further there is no CVD on Gold bars as exempted

and after making jewellery can I export the same after charging excise duty of 12.5% and claim rebate under rule 18,( as I am having cenvat credit unutilized with me)?

2) Is there any condition that if I dont take any cenvat I have to charge ony 1% on jewellery?

Arun

[Rajagopalan Ranganathan]

Sir,

1% duty is applicable "if the said excisable goods are manufactured from inputs or capital goods on which appropriate duty of excise leviable under the First Schedule to the Excise Tariff Act or additional duty of customs under section 3 of the Customs Tariff Act, 1975 (51 of 1975) has been paid and no credit of such excise duty or additional duty of customs on inputs or capital goods has been taken by the manufacturer of such goods (and not the buyer of such goods) under rule 3 or rule 13 of the CENVAT Credit Rules, 2004.

¹⁹²[Explanation.- For the purposes of this condition, appropriate duty or appropriate additional duty includes nil duty or concessional duty, whether or not read with any relevant exemption notification for the time being in force.

If the imported gold bars are exempted from payment of CVD then the manufacturer cannot avail any credit. Under rule 18 of Central Excise rules, 2002 whatever ever duty paid on the manufactured goods whether at concessional rate or at full rate, the same is available as rebate.

Regarding query No. 2 the above explanation will clear your doubts.

[Arun Aggarwal]

Thanks sir !!

AI Summary

Excise duty on jewellery: CVD-exempt gold bars block cenvat credit; rebate claim available on duty paid at manufacture. If inputs or capital goods bore appropriate duty but the manufacturer did not take CENVAT credit, a reduced excise duty applies to the manufactured jewellery; the term appropriate duty includes nil or concessional duty under exemption notifications. Imported gold bars exempt from CVD do not permit the manufacturer to claim CENVAT credit. Separately, rule 18 permits rebate of duty actually paid on manufactured goods, whether concessional or full, upon export of the jewellery.