Withdrawal of self procured empty chemical barrels out of SEZ project, chennai

[harish kumar k]

Our organisation took a work order to execute development works in an SEZ Project. As part of execution, we are procuring Concrete Chemicals directly from Vendor partly from their Chennai Godown and 60% from their Bangalore works upon payment of Excise Duty, VAT etc. Empty barrels are returnable to Vendor in all these transactions.The said chemical was used as Plasticizer in concrete production for execution of activities as per Work order issued by client.

Now we have to withdraw empty barrels and approached Client for permission. Customs AO insisting that we have to pay Duty on the cost of Empty barrels while taking out from SEZ premises.

Please clarify the applicability of levy of Duty on Empty Barrels as we have not availed any SEZ benefits on Raw Material.

AI Summary

Clarification sought on duty for removing empty chemical barrels from SEZ; legal precedent suggests no duty if no consideration. An organization involved in an SEZ project in Chennai seeks clarification on whether duty is applicable when removing empty chemical barrels from the SEZ. The organization procured chemicals for concrete production, paying applicable taxes, and now needs to return the empty barrels to the supplier. Customs officials require duty payment for removing these barrels. The organization argues that no SEZ benefits were availed on the chemicals, and the invoice does not include the barrel value. A respondent cites legal precedent indicating no duty is payable on empty barrels, suggesting the organization needs to demonstrate that removal is without consideration.