leavy of excise duty on purchase of machinery by contractor for outside india contract

[gopesh agrawal]

A Indian contractor want to purchase a machinery from India for a construction work in Bhutan. Is excise duty is leviable on such machinery ( work contract is exempt from service tax).

If no, will it be levied when machinery get back to India.

Please give your opinion with legal support.

[Ravi Kumar]

the sale to nepal bhutan no exemption of excise duty allowed.. spacially mantioned in the acts..

thus duty is payable on that machinery..

in this case service tax is exempt , ie services are provided outside india thus ST not appplicable on service provided od to be provide in J & K & Outside india.

the buyer is treated normally as buyer only ,,not a Contractor...

AI Summary

Excise duty on outward sale of machinery remains payable while service tax is not leviable for services rendered abroad. Sales of machinery destined for Nepal and Bhutan do not benefit from an excise exemption and accordingly excise duty is considered payable; by contrast, services provided outside India are treated as not subject to service tax. The purchaser in the cited scenario is regarded as a buyer rather than a contractor. The question of excise consequences upon the machinery's return to India is not addressed in the reply.