Removal of material under warranty period

[SURYAKANT MITHBAVKAR]

If we removed material to our customer who is having Machine under warranty period for maintaining smooth working of machine. (Additional material free of charge) whether excise duty is applicable.

AI Summary

Excise Duty Applies to Free Warranty Materials; Valuation at 110% of Cost Price per Rule 11, 2000. A query was raised about whether excise duty applies when providing additional material free of charge to a customer with a machine under warranty. Two responses confirmed that excise duty is applicable. The first response stated that valuation should be 110% of the cost price according to rule 11 of the valuation rules, 2000. The second response agreed, noting that excise duty must be paid regardless of whether the additional material is charged, as it is considered captive consumption.