Job work under 7114

[Arun Aggarwal]

Sir,

I have a factory in Delhi and its branch in Chandigarh both are registered with central excise as manufacturer.

If I purchase cenvatable gold in Delhi and transfer the same to Chandigarh, and Chandigarh makes coins out of it under 7114 and the transfer it back to Delhi office which after further processing exports it under rule 18 Rebate.

My question is that whether Chandigarh factory can take the cenvat and charge excise duty and return to Delhi factory or it will be called Job work in the hands of Chandigarh Factory?

My interest is to pay excise in Chandigarh and Delhi factory takes the cenvat and export it under rebate

Arun

AI Summary

Manufacture vs job work: duty liability on coin conversion and use of cenvat credit for export rebate.
Conversion of cenvatable gold into coins at a branch unit is manufacturing and attracts excise duty on removal; alternatively the branch may be treated as a job worker under the job-work exemption if the coins are demonstrably semi-finished and cannot be marketed without further processing. If duty is paid by the branch, the principal unit may claim cenvat credit on receipt and use it for duty on further processing and export rebate claims. Permission to export directly from the branch is a further option to secure rebate under the central excise rules.