The Principal Manufacturer (PM) is not registered under the excise laws and its Job Worker agrees to discharge all the related excise liabilities under Notification No 36/2001.
The PM retains the right and title of the stocks both raw materials and finished goods lying at the Job Worker's premises.
However the excise liability on the stock is being discharged by the Job Worker.
If the job worker fails to discharge the excise liability due against the stocks of the PM, then can the Excise Dept seize the stock of the PM lying at the job worker's premises.
Excise Duty Liability: Principal Manufacturer's Stock at Risk if Job Worker Fails to Pay Under Notification No 36/2001 A discussion on the liability of excise duty for a Principal Manufacturer (PM) whose stock is at a Job Worker's premises. The PM is not registered under excise laws, and the Job Worker has agreed to handle the excise liabilities per Notification No 36/2001. If the Job Worker fails to discharge these liabilities, the Excise Department can seize the PM's stock at the Job Worker's premises. The duty arises upon the removal of goods, and proper invoicing is required. The Job Worker can clear goods daily but must pay the excise duty monthly by the 6th of the following month. (AI Summary)
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